day trading strategy for euro, crude oil, russell, gold futures

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The James’ Report: Professional Resources for Professional Traders

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Let’s review today’s day trading strategy together in the trade room

Dollar Index is trading in the channel reversal zone, and we’re looking for price to break below the 76.610 which will send the dollar tumbling. Also keep an eye on the double top buy zone all the way at the lows of the bear channel.

Dollar 13-range chart tells me to think about trading the slingshot pattern this morning with this strong bear channel, and trading at the LOWS of the channel.

Crude Oil trading at the highs of the channel and price wedge. look for fake-out breakouts to new highs, and use the dollar correlation as your guide.

Crude Oil 34range chart shows a lot more details. Sell wedge highs and below PHOD and buy channel lows. remember to keep an eye on the dollar correlation

Russell is inside the channel ‘holds’ zone and we look for new highs above the zone to buy, new lows below the zone to sell, as well as a price wedge right in the middle.

Russell 34range shows the narrow price wedge

Gold futures trading in the channel ‘break’ zone so we look to buy pullbacks above this zone up to the next level of resistance, or sell a retracement below the zone if price moves lower.

Gold 34range chart shows the short term and long tern bull price channels. follow the plan and remember the dollar is in a bad spot today

CRUDE OIL UP-DATE

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Around the Globe this morning:

– European shares rose in early morning but traded down again ahead of Fed’s latest policy statement. Investors are hoping that the Fed is planning a QE3 even though a decision is not expected today.

– Meanwhile, EU officials are convening for emergency talks before the Cannes meeting in the aftermath of Greece’s decision to hold a referendum.

– Most analysts would agree that the failure to approve the referendum will lead to Greece’s exit from Europe which in turn will plunge the Greek and European banking system into an abyss. While latest polls show that Greeks want to retain the EU membership, the new austerity measures that come with the bailout package are very unpopular.

– The USD was softer with dealers citing the pending FOMC rate decision rather than developments out of Europe. There was some conjecture that the Fed could indicate more stimulus at today’s FOMC announcement.

– The G20 leaders conference in Cannes, France takes place on Thursday and Friday. The Greek drama has given them a lot to focus on.

– The Telegraph commented on the path of the UK economic recovery. Despite the 0.5% GDP figure, weak manufacturing data weighed in leading to warnings of a double-dip recession.

– EFSF might delays its planned 10-year bond issue by a few weeks die to market conditions

– Speculation that China could be contributing €700B to the EFSF

– Italy cabinet to meet later today to discuss new crises measures

– German Oct unemployment unexpectedly rose

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Today’s Economic News:

Today is FOMC Day, which means market conditions will be similar to a Friday morning; get in early, be patient, and then get out of the markets early before things slow down ahead of lunch and the FOMC Rate Decision. Today there is a lot of chatter about clues from the FOMC today regarding a QE3 for the US, as well as any reaction to the current Greece situation in Europe. Day traders will be watching volume and market personality today closely.

We begin the day with 8:15am ADP employment, which is used in the NonFarm Payroll news on Friday of this week. After 930am US Open we will move to the 1030am Crude oil Inventories report, which is always exciting when you trade crude. Remember to stay away from crude oil futures from 1015am through 1040am EST this morning waiting for this news to be released and then looking for the market’s reaction to this news. One of the biggest mistakes we make on Wednesday is trying to trade too quickly after the inventories report comes out.

We then have the 12:30pm FOMC Announcement, which is nothing more than another news release, but then we have the 2:15 Press Conference where Ben Bernanke will take questions about the news release earlier that day. This means that there will be plenty of opportunity to participate, however, finding market personality to be suitable for trading between 1230 and 215 is often difficult, so be careful and remember that if you don’t normally trade lunchtime, this is NOT the day to be ‘testing’ some new ideas. Professional traders know that the only rule on FOMC DAY is there are NO RULES on FOMC Day, so be careful out there after 1230pm today.