June 17, 2011
- in Uncategorized by schooloftrade
3 easy clues from Gold, Crude Oil, and Dollar Futures; Day trading OPEX
800am est
We being our day with crude oil, checking to see if we have contract rollover. I use the market analyzer to check today’s total volume, and when the 07-11 is less than the 08-11 contract we then roll forward.
We will assume Monday (possibly later today) this will occur.
815am est
We review the news today and we have quadruple witching/OPEX on everyone’s minds.
Get in early, get out early.
Nothing likely to be moving after 1030am.
We have 955 and 1000am news so plan on sitting on hands from 950-1005am est.
After the news comes out we need to watch volume closely , as we do expect it to drop off quickly and the market personality will be sloppy.
The dollar index has dropped off its highs from earlier this week and now sits in the middle of the price wedge on the 09 11 contract.
The US dollar is trading right around the BMT which is a VERY sloppy area on the 89range chart, and this will be one of the biggest concerns we have today.
(combine OPEX, crude sharing volume, and the BMT on the Dollar and we have party!)
The faster chart, the 13range, shows me the dollar is not just in the middle of the big wide range, its trending DOWN with new lower lows and lower highs, and with this big pop up over the last 10 days we can easily see how the dollar could drop down to previous support at 74.600
How do I use this dollar to make me money today?
– Dollar in the middle of the range on the 89range chart tells me to be very selective with my trades today.
– The bearish trend on the dollar tells me the long trades I take will likely be the higher % today
– I will keep an eye on the 13range chart to see when the market jumps up and starts trading sideways, then we know the directional bias (long side) will no longer apply.
835am est
We review the crude oil futures and we see the 89range chart confirms cl 07-11 is in the middle of the bearish price channel.
We also see sideways range(s) and we are ion the middle of the range as well.
We will use a faster timeframe to plan our attack.
34range of the 07-11 contract on Crude Oil shows us the following:
– Outside day (below the PLOD)
– BMT is above us
– Big Drop down, and now popping back up
– Bull channel
– Low volume market
I assume this means that the bull channel and the PLOD above us will draw price into the range above, test the PHOD and since its Friday OPEX we will end the morning at the OPEN or the BMT.
My plan of attack is easy:
– Outside day I’m buying pullbacks with new higher highs.
– The bullish price channel confirms rising prices so the long side will be the higher % side until this channel is broken.
– Once we go INSIDE (above PLOD 94.29) then we trade inside the range above us. Buy the lows, sell the highs of the range you are in.
– As price rises I’m selling at resistance first, but keeping an eye open for the opportunity to buy a pullback when the resistance becomes support.
– As prices fall I’m buying at support, which will be high % today with this bull channel on the crude and the bear channel on the dollar.
– If we make new lower lows through support I will then sell retracements with new lower lows.
Our specific plan of attack on Crude Oil:
– As price falls im buying support first at 93.34, 93.00, 92.86, 92.53, 92.37, and LOD at 92.12
– The highest % trades today will be buying at support as price falls.
– As price rises im selling at resistance first (higher risk today outside day) and then looking to take advantage of the falling dollar/rising crude and I will buy pullbacks.
