The Secret of the Pendulum Swing | SchoolOfTrade Newsletter 03/01/17

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Crude Oil is bearish, but one major support level and “two legs down” off the high tells us to be looking for a trap-high for the most reliable selling-opportunities tomorrow.

S&P is bullish, but a key trend-line tells us to look for the sellers to “try twice” before looking for the next leg higher tomorrow.

Gold is bullish, but the “pendulum swing” is telling us it’s too late to buy now, and watch for a trap-low for the most reliable buying opportunity tomorrow.

Euro looks bullish at first glance, one big clue on the chart is telling us that sellers are eager to send this price back to the low, and it’s up to the bulls to stop them tomorrow.

FDAX is bullish with a spike & channel, and a big round-number on the chart makes it easy to know where the most reliable buying opportunities will be tomorrow.

Crude Oil

Crude Oil is bearish and trying to finish off a measured-move tomorrow, but we’re ‘two legs down’ off the highs, which tells us the most reliable selling-opportunities will be using traps and failures up at resistance levels tomorrow.  The measured-move is the big clue on the chart; we want to be sellers, but we don’t want to sell into that support area, so stay focused on selling ‘high’ tomorrow, even if this market keeps tumbling lower. 

E-Mini S&P

E-Mini S&P is bullish with a spike & channel and the buyers are patiently waiting for price to come off today’s all-time highs so they can buy it cheap for a target going back up to the high tomorrow.  The move higher was very strong today, which tells us that we won’t likely see this market pull back all the way to the ‘battle zone’, so we’re watching previous swings and looking for the sellers to fail on the next pullback for the first clue to start buying.  The big obstacle for the bulls will be the resistance trend-line, so we will be watching for a successful breakout-pullback for a move back to the high.

Gold

Gold is bullish and trying to complete the pendulum swing, but that triple-up resistance is a little too close for the buyers to keep buying, so we’re watching for a trap below the recent pullback for the most reliable buying opportunity tomorrow.  One thing to remember is that just above the recent high is the pendulum target, so beware buying ‘high’ and make sure we get solid proof before we buy the next leg up to the quadruple-up and prior high tomorrow.

Euro

Euro is bearish and trying to re-test the low tomorrow, but this strong move higher certainly gives the buyers an opportunity to take control if they can hold this pullback.  The bears got their Double-Down target on a strong move lower this morning and it’s easy to see the bears took their profit, price corrected higher, and now the sellers are reloaded and ready to move back to the lows.  On the flip side, the bulls look good with a strong move higher as well, but they need to have clear control before we buy this market, so the bulls will be looking for a successful breakout-pullback above the falling resistance trend-line for a target up at the measured-move.

FDAX

FDAX is bullish with a spike & channel, which tells the buyers to stay patient for a pullback to levels of support waiting below.  The bulls made a strong run today which tells us that buyers will likely take whatever they can get their hands on tomorrow, with the ideal pullback coming down at the range between the prior week high and the 12,000-round number.  Assuming we get the pullback, the target will be back to the Double-Up target overhead, and then we wait to see where we go from there.