Day Trading Morning Prep; Gold and Crude Oil setting up for easy trading opportunities

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The US Dollar Index shows three different aspects of its price structure today. First, we have a medium term bullish price channel and we are in the middle of that channel. Second, we have a short term sideways range and we are at the highs. And third, momentum appears to be overbought at these highs, which shows signs of exhaustion at these highs.

The Dollar Index correlation is very strong, so I will use the short term trend of the dollar as my guide today. The short term trend is sideways, so no directional bias from the dollar at this time, however, if we make new highs or if we can tumble back to the range lows we will use those as clues for future direction on the markets we trade most. The dollar can change very quickly, so watch closely.

US Dollar Index SchoolOfTrade.com

Crude oil futures also have a few moving parts to consider this morning. Review of the 89range chart and you can see a strong medium term bullish price channel. Second, you can see the trend line overhead at 98.00 creates a bull price wedge from the channel lows and the trend line as the highs. Third, our experience on this market tells us to stay away from the 98.00 area. My goal today will be to buy at the support levels off the lows of the channel, and avoid getting wrapped up in trying to buy a breakout above 98.00. Bull channel tells me to be patient and wait for buying opportunities at the lows.

Crude Oil SchoolOfTrade.com

Gold Futures are setting up nicely for a variety of trading opportunities this morning. First, the bearish price channel is the key factor and we are at the highs. Second, we see a sideways range and we are at the highs. Third, look down at the bottom and you can see the momentum indicator(s) are about to trigger a swing trade short as well. Three signs of selling opportunities at these highs/resistance of this channel and the trading range. The US Dollar is potentially going to rise this morning, so keep that correlation in mind as well. Im going to use a much faster timeframe to plan my entry on this short position, so come join me in the live trade room this morning.