July 12, 2012
- in Uncategorized by schooloftrade
Dollar Index & Crude Oil Futures Technical Analysis Prep
730am EST
We begin
this morning with a short review of the dollar index. We use the dollar index correlation
effectively every day,
and today we have a breakout on the dollar index and we’re wondering if it will
continue because there is great opportunity if the dollar index fails and
reverses. You can see the 144-range
chart shows us the big-picture, double-bottom resistance overhead, price wedge breakout,
and we have an OUTSIDE TRADING DAY because we’re above the PHOD.
This tells us today that the dollar index isstrong, but we are concerned it may soon fail, so we’re keeping an eye out
today for two things; first, if the dollar
index keeps plugging away higher up to 84.260 we’re selling markets such as Crude
Oil, gold futures, euro, E-Mini-Russell with our Wave-Pattern SHORT. Second, if the dollar index fails and drop,
we are going to see the PHOD 83.760 re-tested and this will provide us with
buying opportunities off the lows on many of our favorite markets, which were
dropped lower overnight on the Fed Meeting Minutes.
Crude
Oil Futures are trading again this morning inside the previous day’s range,
which we call INSIDE DAY, and have a specific day trading strategy to follow
when we see this on ANY market. We also
see the price wedge which adds to the importance of the inside day
strategy. We can see trigger-zone support
and resistance above and below this price wedge, which tells us one of three
things are likely to occur this morning.
Oil Futures are trading again this morning inside the previous day’s range,
which we call INSIDE DAY, and have a specific day trading strategy to follow
when we see this on ANY market. We also
see the price wedge which adds to the importance of the inside day
strategy. We can see trigger-zone support
and resistance above and below this price wedge, which tells us one of three
things are likely to occur this morning.
First, price may sit in the middle of the range and we may sit on hands
and wait. Second, price may test the
highs or the lows of the price wedge and trading range and we will sell the
highs/resistance and buy the lows/support trying to fade-the-breakouts. Third, we saw this on Wednesday, price may
test the highs or lows of the price wedge and decide to keep on ‘grinding’
higher/lower on inconsistent volume. If
price grinds higher or lower we need to remember its very dangerous to buy the
highs or sell the lows, so our only hope is to get the reversal, or wait to
clear the trigger-zone support below or resistance overhead and then start
using the wave pattern to get into the now-trending market. Stick to this plan today and you will make
your daily goal easily. Avoid trading
the middle of this range at all costs.
and wait. Second, price may test the
highs or the lows of the price wedge and trading range and we will sell the
highs/resistance and buy the lows/support trying to fade-the-breakouts. Third, we saw this on Wednesday, price may
test the highs or lows of the price wedge and decide to keep on ‘grinding’
higher/lower on inconsistent volume. If
price grinds higher or lower we need to remember its very dangerous to buy the
highs or sell the lows, so our only hope is to get the reversal, or wait to
clear the trigger-zone support below or resistance overhead and then start
using the wave pattern to get into the now-trending market. Stick to this plan today and you will make
your daily goal easily. Avoid trading
the middle of this range at all costs.
