Buy the Rumor, Sell the News & 5 Powerful Price Patterns

Markets rallied today on optimism that the US would approve the Coronavirus Stimulus Bill, but with such big moves on the charts, I suspect traders are actually “buying the rumor so they can sell the news” on Wednesday…

Knowing this, my job tonight is to plan for that sharp correction, and be ready with the right set-ups to handle all the momentum – are you ready?  

Bears Have Control on Oil, But You Can’t Ignore the Bullish Strength…

Crude Oil is bearish after a steep pullback off this morning’s high, and I’ll be looking for set-ups to get short for a re-test of today’s low tomorrow morning…

But I also can’t ignore the strength of the bulls earlier this morning, which remind me that a re-test of the high is certainly possible, so I’ll be looking for “traps” if we can get the momentum back in the hands of the bulls.

E-Mini S&P Smells Like a Bull Trap…

E-Mini S&P is bullish, but I can see two important clues, telling me to avoid buying these fresh highs; we’re three legs up, and we just re-test a major high.

Knowing this, I need to wait for more information overnight; if the bulls can hold and push higher, I’m looking to buy pullbacks ahead of the “round number” target overhead.

But if the buyers struggle at these highs, sellers will smell blood in the water, and we’ll start looking for reversal patterns to get short.

Gold Buyers Watching the Triangle…

Gold is bullish and trading inside a range this evening, which tells me to buy low, sell high, and avoid the middle on Wednesday…

Knowing this, our most reliable buy setups will be below the range using seller-failure patterns, and our best sell setups will be crown reversals off the high.