Day Trading the News; Trade what you SEE not what you THINK

We have multiple news events at 830am this morning, so it’s going to be more difficult to read the news as well as we usually do.

Jobless Claims and Durable Goods at 830am, we have 2 major events that need to be addressed.

So how do we trade it? We wait for the MARKET to react, and we don’t predict.

More news variables will mean you need to wait longer to see the actual feedback from the market

– Read the tape
– Watch the speed
– Look for your entry patterns, after we see them.

We have crude oil inventories at 1030am est, this is usually on Wednesday, but we usually don’t have the 830am news.

This means the Crude oil futures market is on our watch list today as being a potential disaster waiting to happen.

We know the crude has a different personality before and after the inventories number, so watch closely at crude right now.

Looking at the crude slower timeframe (34 range chart) we can already see the big candlestick WICKS and sideways price action lacking conviction for where it wants to go next.

Remember we have a holiday weekend with Thursday and Friday closed, so expect people to be hitting the exits earlier than normal.

We usually see action into 1230pm EST, today look for that to slow much earlier.

So how do we trade this today?

– Watch the reaction to the news here at 830am
– Sideways markets right now, so buy the lows and sell the highs
– Dollar is flat, so patience will be the key
– And don’t try to force any late-morning trades if the volume dries up
– Get in, get our money, and get out!

830am est

– We’re waiting on the release of 830am jobless claims and durable goods orders

– The dollar index pushed its new highs overnight, and now drops into a sideways trading range off the highs of the price channel

o Sideways dollar = sideways market on everything else so be patient
o Plenty of downside risk on the dollar
 Dollar drops = everything rises
 Looking for buying opportunities at the lows of the price ranges today as the higher % opportunities

– Choppy and low ATR, but slightly bullish

o This means we need to be patient, wait for this price to improve

– Speed of the dollar index is slow ahead of the news, lets wait and see how quickly the dollar moves AFTER the news

News is out

– Jobless Claims better than expected
– Personal Income better than expected
– Durable Goods order drop higher than expected

930am est

– We are seeing some WEAK price action

o Slow speed of the moves

 RED POT everywhere
 We want to see GREEN POT
 Pace of Tape Indicator measures the speed of the orders coming into the market

o Lack of follow-through (we don’t see big moves)
o Price is testing trend lines
o Price is resting on big round numbers
o Price is resting on double-tops/bottoms
o Flat Trigger Lines

 There’s no MOVEMENT in the market up or down, only sideways