My Favorite Reversal Patterns (Wed. Trade Plan)
We’re getting prepped for Wednesday’s trading session, and I’m seeing a lot of ranges on the charts tonight, which tell me to look for support/resistance levels just outside the range and focus on reversal patterns to buy low and sell high…
Crude Oil is bullish and trading into multiple resistance levels overhead. We have a range below us acting as a magnet so I’ll be looking for a bearish reversal pattern to get short…
Emini ES is bullish and looking for a pendulum swing up to weekly highs. If the bulls can finish the job, I’ll be excited to get short off the highs with one of my favorite crown reversal patterns…
Gold is bullish too, but we’re sitting on top of the weekly range, will acts like a magnet, and I’d like to look for a bearish reversal pattern at a key measured-move resistance just overhead…
E-Mini Keys to Success:
- Day starts in a range, breaks lower, and snaps back up into the range
- Bulls have momentum edge, expect pendulum swing to highs
Best Setups for Tomorrow:
- (UP) – 2-try trap (or) 123-breakout for bulls. Crown reversal at resistance for bears.
- (DOWN) – seller failure off channel low (or) nested seller failure for bulls. 123-breakout for bears.
- (SIDEWAYS) – sit on hands, wait for breakouts to buy low, sell high.
Crude Oil Keys to Success:
- Strong Bull Spike into narrow trading-range
- Buyers got long below range and complete pendulum swing at high
- Can buyers keep this going? Will they fail and collapse lower?
Best Setups for Tomorrow:
- (UP) – 123-breakout (or) 2-try trap for Bulls. Crown reversal for bears
- (DOWN) – 123-Reversal (or) Buyer failure above range for bears. Nested seller failure below range for bulls.
- (SIDEWAYS) – sit on hands, wait to fade breakouts.
Gold Keys to Success:
- Range-bound market says to keep selling at resistance levels above the range, buying at support levels below the range
- Sellers failed to finish rotation back to the lows, giving bulls potential breakout higher.
- Sellers Looking to get short around resistance levels overhead with failure setups.
- Buyers looking for a breakout to complete the measured-move overhead.
Best Setups for Tomorrow:
- (UP) – Buyer failure (or) nested buyer failure for the bears at resistance. 123-breakout for the bulls.
- (DOWN) – Nested Failure with trap for bears to avoid the range (or) 123-Reversal for the bears. Nested seller failure at support below the range for bulls.
- (SIDEWAYS) – sit on hands, wait for breakouts, buy low, sell high.
