February 2, 2011
- in Uncategorized by schooloftrade
Day Trading Morning Prep Gold, Crude Oil, Dollar Index, Euro, E-mini Russell Futures
Let’s begin our morning routine with the economic news for today’s trading session.
8:20 Gold & Currencies OPEN
8:15 ADP Employment Report
9:00 Crude Oil OPEN
9:30 US Market OPEN
10:30 Crude Oil Inventories
11:00 Transition into Lunch
11:30 European Close / Live Webinar in our Trade Room
I will set my alarm 5 mins before the news and 5 minutes after the news, looking for the reaction to the news event for direction ahead.
Looking forward today we have a major snow storm across most of the US, affecting all the major exchanges, tough to tell how this may affect price action, but its an issue we are aware of.
We have crude oil inventories @ 1030am today which means we will be watching the personality on crude oil very closely.
We expected the crude oil market to be a little sluggish ahead of news, and then looking for a big improvement in volatility and volume after 1030am EST news is released.
Other than that, its a quiet day today ahead of big news on friday @ 830am est.
Lets take a look at the charts this morning…
The dollar has been trading at the lows of this price wedge for some time now, making the euro rise and the gold market trade in a sideways range.
this morning we see the dollar broken new lows and tested the big ronud number of 77.000.
With momentum looking almost overbought already in this retracement, i would expect the dollar to come back down and re-test the 77.000.
We watch the dollar closely all morning for the Dollar Index Futures Correlation so pay close attention to how this market moves.
the big issue will if the dollar makes new lows, or if the DX 03-11 goes back up into this wedge pattern above it.
New lows mean new highs on the markets we trade, so new lows on the dollar and im buying pullbacks at new swing highs on the gold, crude oil, euro, etc.
Crude Oil Futures
We can see three big issues on this 34range chart on crude oil:
– yellow trend lines mark the larger Wedge Pattern
– pink trend lines marke the price channel
– white box marks the sideways trading range
Im looking to be a buyer above 91.00 as we go back up into the sideways range above us. We need to pay attention to the area above 91.00 as a major trading range, so anything below 91.00 is the highs of the range below us. Keep that in mind while we Buy the lows, sell the highs, and avoid the middle.
Im also watching the price channel, looking to buy the lows of the channel, as well as using the lows of the price wedge as support.
remember to keep an eye on support for buying opportunities and sell at resistance.
Gold is caught in a web of trend lines that define this narrowing Wedge Pattern
You can see support around 1329.3 and overhead resistance of 1340.1 amoung many other trend lines in blue that run through the middle of this trading range.
this type of pattern comes from one thing….sideways ranges…so lets keep an eye on the fact that we are in the MIDDLE of this range, and this will be the most challenging area to trade.
Look for the best opportunities to buy support at 1329.3, 1326, 1323, and 1309
Look for the best selling opportunities at resistance levels of 1340, 1342, 1343.8, 1345.6, and up.
We want to Buy the lows, sell the highs, and avoid the middle and if the price breaks new highs we will
the Euro currency futures have a nice looking wave pattern long setting up as we speak on the 34range chart. Just wait for momentum to confirm first and take your profit at the highs of 1.3856.
the mini russell has broken above its price channel, testing the highs of 800.0, a very big round number. With this level at the highs we look to sell the 800 level looking for price to go back down into the price channel below it.
Buy a Pullback at support or if price breaks new lows we will Sell a Retracement at resistance
the Euro currency futures have a nice looking wave pattern long setting up as we speak on the 34range chart. Just wait for momentum to confirm first and take your profit at the highs of 1.3856.the euro continues in the same opposite direction of the dollar, in a similar price wedge noticably.
We’re at the highs of the price channel, so im always looking for the 3 signs of Price reversal to get short off the highs.
sell at 1.3856, and sell the break below 1.3800 with a retracement or wave pattern.
Im also looking to buy at support, so keep a close eye on 1.3720 as a great spot to buy along with 3700, 3661 and 3600 as price drops back down to the lows of the price channel.
We will watch the dollar index closely for the euro trades.
E-mini Russell Futures
the mini russell has broken above its price channel, testing the highs of 800.0, a very big round number. With this level at the highs we look to sell the 800 level looking for price to go back down into the price channel below it.Notice the trend line support in blue around 781.5, so look for that level as a place to take some profit as this price drops back down to test the 772.4 lows.
On the flip side of that, if the buyers control this price action, im looking for a possible wave pattern long using the trigger line support around 792.8. Look for the speed and the momentum to confirm this entry.
