Miss the Reversal? Next Best Entries are Here!

Woah, what a reversal off those highs!

We got the reversal off the highs today, and with momentum now in the hands of the sellers, we’ll be looking for re-entries on Wednesday morning…

The Eminis are both very bearish, so I’ll be looking for sell setups at a couple key resistance areas up overhead, but there’s one key difference between the S&P and Nasdaq that you need to pay attention to…

Gold, on the other hand, is very bullish, but something’s “not right” about today’s breakout and I’ll be looking for ways to trap in the buyers so I can get short back into the range on Wednesday. 

E-Mini S&P (ES):

E-Mini Keys to Success:

• Bulls tried to push higher but failed and price fell lower, completing a ‘pendulum swing’ reversal to the opposite side of the range.  Who could have seen that coming?
• Sellers have momentum so they will be looking for short up at resistance levels overhead, and trading breakouts if the move continues lower.
• Buyers have no momentum and need to stay patient for a 123-Reversal

Best Trades for Tomorrow: 

• [UP] – buyer failure to sell (or) 123-Reversal to buy
• [DOWN] – 2-try trap & 123-breakout to sell

E-Mini Nasdaq (NQ):

Nasdaq Keys to Success:

• Buyers failed to hold this morning’s breakout and price returned back into the range from yesterday, but instead of completing the ‘pendulum swing’ (like the Emini ES), price stalled inside the range.
• Sellers have all the momentum so they will be looking for shorts at resistance levels above the range, or breakouts to new lows before they complete the ‘pendulum swing’
• Bulls have to be careful not to chase this higher because sellers will be looking to short the pops until they complete the ‘pendulum swing’

Best Trades for Tomorrow:

• [UP] – buyer failure to sell (or) 123-breakout to buy
• [DOWN] – 2-try trap & 123-breakout to sell

Gold Futures (GC):

Gold Keys to Success:

• Watching rollover to the 08-21 contract
• We spent most of the day inside a range but something spooked the buyers and price ran higher to the 1900 level
• Buyers have all the momentum, but this move appears to be a breakout, so buyers need to be careful buying until they can see this area hold with a range.
• Sellers will be looking for ways to short these highs using failures going back to the range.

Best Trades for Tomorrow:

• [UP] – buyer failure to sell at MM (or) 2-try trap to buy
• [DOWN] – seller failure to buy (or) 123-Reversal to sell