August 31, 2011
- in Uncategorized by schooloftrade
Traders Look for Clues from Economic News this morning
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The James’ Report: Professional Resources for Professional Traders
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– Crude Oil tests the highs of the Major Price Channel, and lack of demand may cause this market to tumble today and tomorrow
– Gold Futures consolidated this morning ahead of ADP Employment news in the US
– European equity indices opened the session higher, tracking yesterday’s gains in US equities, as minutes from the US Fed suggested that a number of members on the FOMC committee supported additional stimulus measures for the economy.
– German cabinet approved its draft law framework for expansion of EU rescue mechanism
– During August, British investment banks faced a slowdown in business conditions. According to data from Dealogic, commissions from share and debt sales and fees related to M&A declined over 45% y/y during the month to the lowest level since 1997.
– The London Telegraph’s Evans-Pritchard stated that the EU is near recession, even though austerity measures have yet to impact the economy.
– According to the FT, some lawmakers in Germany believe that parliaments should have veto power over future aid packages and sovereign bond purchases.
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Today’s Economic News:
Looking at the news this morning we first remind ourselves that today is Wednesday of the final week of the summer.
This tells us two things: First, we need to be patient for volume early this morning and be disciplined not to over-trade the late morning since it is the summer. Second, its Crude Oil Inventories today so we need to remember the 3 Phases of Crude Oil today when watching the clock.
We begin our day with some important jobs news with the ADP employment report at 815am. This news will be used on Friday’s NonFarm Payrolls.
We then go through the US Open at 930am and we have 945am Chicago PMI, 1000am Factory Orders, and then 1030am Crude Oil Inventories.
All three of these news events will be important this morning for different reasons and we will discuss these in detail today in our live trade room.
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Looking at the Charts:
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Our plan of attack on crude oil this morning:
– Using the inside day, price wedge, and sideways ranges
– We will buy support 86.47/87.10/87.67
– We will sell resistance at 89.00/89.18/90.00
– We will avoid the middle of the range around OPEN 88.50
– If we break above the PHOD we buy pullbacks
– If we break below the PLOD we sell retracements
– If we break through resistance we can buy pullbacks because of the bull channel
– As price falls to support we want to buy as the higher % trade b/c of the bull channel
Our plan of attack on Gold:
– Buy the lows and sell the highs of the wedge
– Sell the PHOD as resistance
– Buy the PLOD as support
– Buy the lows and sell the highs of the range we are currently in (inside day & sideways range)
– Bear Channel tells me the higher percentage trades will be short today.
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