Trading a Runaway Market | SchoolOfTrade Newsletter 11/09/16 | CL, ES, GC, 6E, FDAX

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Notes for Tonight’s Newsletter:

Crude Oil is bullish and trading at the lows of a bull wedge, E-Mini S&P is bullish and trading at last month’s high and only a few points away from re-testing all-time highs, Gold is bearish and trying to re-test the overnight low and complete the measured-move, Euro is bearish and trying to re-test last month’s low, but a ‘grind break’ of this bear channel tells the sellers to be careful, and a new addition to our newsletter, the FDAX is bullish and trying to finish the measured-move and prior month high.

Crude Oil is bullish and trading at the lows of a bull wedge this evening after the bull channel failed to make a full rotation back to the highs, thus becoming a wedge.  The bulls have control and will be looking for opportunities to buy the low of the channel (also the high of the range) as well as the low of the range tomorrow.  Targets for the bulls will be back to re-test the resistance at 45.85 and then up to complete the measured-move at 46.75.  Sellers need to wait for proof, which will come after a strong move lower, holding below the low of the battle zone (44.17) for a target going back to the low at 43.07.

E-Mini S&P is bullish and trading at last month’s high and only a few points away from re-testing all-time highs.  The E-Mini S&P had an incredible run today with big moves in both directions, and whenever I see movement like this I am always going to be looking for signs of a trading-range tomorrow, and my focus will be to buy the low of that range as soon as we see the buyers struggle to push through the highs.  Buyers need to see this move continue on strength through the previous month’s high for a push up to the all-time highs and possibly a triple measured-move tomorrow.  We can assume that any pullback off these highs will be seen as a buying opportunity, which tells the bears to be careful trying to call a ‘top’ until they see a sustained move lower tomorrow.

Gold is bearish and trying to re-test the overnight low and complete the measured-move but it looks like the bears are waiting for prices to pull back a little so they don’t have to sell directly into the lows.  The sellers would love to find selling-opportunities at the many resistance levels overhead, especially the un-tested reversal-lines at 80.3 and 91.5 for a target going down to the measured-move.  Buyers need to wait for proof in the form of a successful breakout-pullback above the 80.3 reversal-line and the moving-average for an attempt at going back to the round number and battle zone tomorrow.

Euro is bearish and trying to re-test last month’s low, but a ‘grind break’ of this bear channel tells the sellers to be careful selling these lows and wait patiently for an opportunity to sell at resistance levels overhead.  The euro appears to have broken through the overnight lows and continuing on strength, but the short-term spike & channel and large bear channel tell us the most reliable selling-opportunities will come after a ‘trap high’ to allow more sellers to enter at a better price.  Buyers need to wait for proof in the form of a strong push higher, getting back above the low of the range and holding a pullback on the way back into the middle of the range and possibly all the way back to the highs tomorrow.

FDAX is bullish and trying to finish the measured-move and prior month high targets waiting overhead.  Just like with the E-Mini S&P, whenever we see a market move like this in one session we know that buyers will be looking for a better price to enter this trend, so we know the most buyers will be waiting for a pullback and that pullback may develop into a trading-range or it may push through to new highs, we won’t know until we see it in real-time.  Buyers would prefer a pullback to the un-tested reversal-lines below the current price, or they will need to grab a breakout-pullback before it gets to the measured-move tomorrow.  Sellers have zero proof and will need to wait for sustained strength off the highs before they can even think about trying to sell this market, and it will be ill-advised to try and call a top on this market until we see that.