Non-Farm Friday Strategy | SchoolOfTrade Newsletter 10/06/16

Click here to download today’s charts

Notes for Tonight’s Newsletter:

We’re heading into ‘Non-Farm Friday’ tomorrow and we have some big news on the schedule that will most likely give us some big opportunities; Crude Oil is bullish and trading at the highs of the session, E-mini S&P is bullish and trading at the highs of a spike and channel, Gold is bearish and trading with a spike & channel, and Euro is bearish after a strong push lower today and trying to make it back to last month’s low.

Crude Oil is bullish and trading at the highs of the session which means tomorrow we will be looking for clues to see if the buyers want to keep pushing up to complete the measured-move at $51.00 or if they take profit and let price collapse back down to the round number at $50.  Buyers need to see price continue with strength and hold above the ‘double up’ at 50.49 if they are going to make a run to the highs of the spike & channel and measured-move.  If the buyers can’t keep pushing higher, then we expect to see a trading-range develop where our focus will to buy the lows and take profit back at the highs. Sellers need to be patient right now, they need to get back below the moving-average and hold a pullback without selling into the support trend-line on the way back to $50 tomorrow.

E-mini S&P is bullish, trading at the highs of a spike and channel and right back to where we left-off last night, at the prior week closing price of 56.75.  The bulls have control but don’t want to buy the high so they will be looking for a successful breakout-pullback above the spike & channel or they need to wait for a move back to the channel lows and look for buying opportunities back up from there.  Sellers have a great opportunity to send price back to the lows, but they need to wait and see the buyers fail at the lows of the channel first, and then hold a pullback with a target going back to the lows.

Gold is bearish and trading with a spike & channel this evening, which tells the sellers to be looking for traps and failures up in the ‘correction zone’ and ‘battle zone’ overhead with a target going back to re-test the lows.  The sellers had a very strong move lower today which will make it hard for the buyers to get anything reliable until they can get a successful breakout-pullback above the 65.1 reversal-line with a target going back to today’s high.

Euro is bearish with a strong move lower today and the first thing that stands out is that we didn’t see a single ‘trap’ above previous swing highs which tells us there are most likely a lot of sellers who didn’t have a chance to get into this move and they will be waiting for the next opportunity to do so.  Sellers got their measured-move to finish the session so they will be looking for a correction back up to overhead resistance levels for a move back down to re-test the lows and most likely a slide down to reach the prior month low at 11640.  Buyers have an up-hill battle ahead of them tomorrow and the only way they can find something reliable will be with some serious strength and hold a pullback on the way up to the battle zone overhead and then again above the battle zone up to re-test the highs, but its unlikely they will get the chance.