Dollar Tumbles and Gave Me a Great Short Entry on Crude Oil and Gold

830am EST

– We have durable goods orders at 830am EST

– This is one of my ‘big 3’ news events for the pulse of the US economy

o Durable Goods = heavy machinery, products, parts, made in big warehouses
o Jobless Claims = number of people filing for benefits
o Nat Gas Inventories = how much natural gas do we have

3 indicators…

– More people going back to work (lower jobless claims)
– Those people are making products (durable goods order rise)
– The products are being made in factories (nat gas inventories fall)
If durable goods orders fall, rather than rise…

– People are going back to work, but they are not producing products, which means the natural gas inventories are rising because of lack of production (stagnant economy)

Dollar index is trading at the lows of the trading range from yesterday

– If the dollar bounces off these lows we will see everything drop
– If the dollar breaks these lows, we will see everything rise
– The thing we want to look for is the dollar simply testing and/or breaking the extremes (highs / lows)

Crude oil futures are trading right in the middle of the sideways trading range below 76.00 on our 34-range chart.

– We saw 2 patterns on the crude oil 13-range and 4-range charts and decided to skip the trade b/c momentum wasn’t looking right, and it saved us from a loss.

– We also avoided a trade b/c we saw a trend line in our way, and our rules kept us out of that loss as well.
– So far today, we’ve earned money by protecting our capital.

– The personality of the market on crude oil is undecided, doesn’t know if it wants to keep testing new highs or pull off the highs and drop.

930AM EST

– Gold futures still making our job easy trading at all-time highs, so we always look to sell the highs.

1015am EST

– Watching the gold futures for a breaker long above 1301.6, and a 2-step short below 97.2

1035am EST

– Euro futures at the lows of the slower timeframe (34range) which tells us the buy-side is the better side to be trading right now

– I open my 13-range (day traders timeframe) and I see a breaker long above 3474, with targets 95, 15, and the high of the channel @ 40

– I also see a 2-step reversal off the high of day, we need to get below the support, with entry below 3434, and targets of 18, 00 (big round number) and then the lows of the channel @ 67