June 10, 2011
- in Uncategorized by schooloftrade
Crude Oil Futures tumble, Selling Retracements all the way down
Reminder to be rolled over to the 09-11 contract on the following markets:
– Dollar Index DX
– E-mini (ES, YM, TF, NQ)
– Currencies (6E, 6J, 6A, 6B)
– Fixed Income (ZB, ZN)
Crude Oil and Gold are a little different for contract rollover.
820am est
We review the Crude Oil and we see the following on the 89range chart
· Price Wedge, at the highs
· Sideways range(s), at the lows
· BMT and 100.00 below us
· Minor (previous) price wedge below 99.50
We then use our 34range chart to plan our attack today
Inside day, at the PLOD, which means we may be an OUTSIDE day very shortly. Sell Retracements if we break new lows BELOW the PLOD.
My goal today will be getting into the wedge below 99.50, then we should tumble down to 98.50
**Remember the POWER of an inside day, turning outside, and then coming back inside. Look to buy the PLOD if we break higher again.
If price rises:
– Avoid the middle of the range around 101.50, also the open 101.30
– Selling resistance levels first, and then looking to buy pullbacks with higher prices.
– Selling 102.00 highs of the wedge/channel
– Sell 102.40, 12.75, 103.30, 103.35
– We do not expect much action to the higher side today.
– We will be buying at support as prices are dropping
–
Price Falls:
– I’m buying support levels first, then selling retracements with new lower lows.
– Even with prices falling this morning I will not sell the lows.
– Avoid the BMT and the big round number of 100.00
– Buying 100.80 support level, 100.45, 100.20 as support. Then sell retracements below these three major support levels from the 89range chart.
– Avoid 100.00
– Buying 99.52 support, and then selling below 99.50 to sell the highs of the wedge below us.
– We will HOPE for price to break the 99.50 so we can sell it down to 98.07 the lows of the wedge.
910am est
We’re seeing very concerning sloppy price action on crude oil, lack of follow through makes it hard to be confident.
935am est
We review the dollar index and we see a previous attempt at trending UP
We use the 13range chart and see the sideways range confirms there is NO trend on the Dollar at this time.
The dollar lack of trend tells me I can buy or sell with the same effectiveness on the markets I trade. There is NO strong directional bias for day traders.
Swing traders, position traders, long term day traders would look at the up trend and stay new short on the markets they trade.
We review the crude oil and we see us trading near the 100 and the BMT so we need to beware of this area.
The area around the 100.00 (100.15 down to 99.85) is assumed to be very sloppy.
We want to buy these lows/support on crude oil, or wait to get below the 99.85 for the best options to sell.
1000am est
I got the trade I wanted today, selling the highs of the wedge below us.
Now at 10am the market has dropped a bunch in a very short timeframe and we transition into a sideways chop.
We were wise enough to mark trend lines as support below us and we are using these trend lines for target, and to know WHERE to look for lower lows.
The 99.00 big round number FEELS like a grumpy/sloppy/I don’t wanna move type of price level.
We need to see lower lows on crude oil to feel better about our short trades get away from this area.
1015am est
We have the dollar making new highs and the euro making new lows.
Very odd that the crude oil and gold are NOT making new lows…and remember…when things don’t make sense…usually there is a profitable opportunity right around the corner.
At some point these markets will line up again, and when they do, we will be ready for it. That will remove the in-efficiency we see on the dollar and crude/gold
1030am est
We made easy money the first hour of the day, now the market personality appears to be headed to the weekend.
We expected this, no surpise, definitely disappointed we aren’t making ticks still, but we plan our attack for the rest of the morning.
If price rises:
– Being selective, it’s a Friday
– Im selling resistance first, then buying pullbacks
– Sell the highs of the new wedge at 99.70
– Sell the highs of the bear channel 99.80-99.85
– Avoid the 100.00 big round number
– Avoid the 100.00 BMT 89range
