Scalping Gold and Crude Oil Futures Sideways Markets
Crude Oil, Gold, Euro, all trading at their lows this morning when we open our charts.
The Dollar is sideways at the OPEN, so this is a little misleading.
These lows appear to be premature because the dollar has not broke the highs of its trading range, which means the new lows are not fundamentally being taken down.
Check out the blog for the ‘Dollar Index Correlation’ to learn more about how the Dollar affects everything else.
We can see the new lows being tested on crude oil when the dollar makes new highs
The slower timeframe shows us now trading below 72.00 and we are in a strong downtrend market.
Looking to sell with the current trend below 72.02, and we can look for a reversal and buy above 72.18 which is above the trend line at 72.10.
The key right now will be finding ways to trade SHORT with the trend, without chasing after anything outside of our rules.
We don’t want to get emotionally attached to the short side, but when we cant see a sideways range, we need to trade with the short term trend, which is down.
We will also watch out for a sideways range developing around 72.00 which will give us some more feedback from the market.
We can see gold futures trading in a sideways range from 1218.4 down to 1212.3
We know in a sideways trading range that we should buy the lows and sell the highs. Im looking to buy around 1213 and looking to sell around 1218
900am EST
– We’ve made 2 trades today, both were winners
o First trade on gold was easy, buying the lows of the trading range at 1213.3
o 2nd trade was more challenging because we tried to scalp selling the lows of the crude oil, and the breakout didn’t go very far.
Watch the dollar looking for the dollar to move first, and then we can look for the breakout on crude oil
In the meantime, lets try and trade buying the lows and selling the highs until the dollar can break out.
We’ve broken down below that sticky level of 2682 and now we’re trading in the bracket from 2700 down to 2500
We have support at 2600 which is causing a little bit of chop, so we will avoid this area for the time being.
We see support at 2524, and this is where we can see the highest probability trade ahead of us.
I’m looking to buy the lows at 1.2524 for a reversal off the bottom of this trading range.
One concern is that we can see we’re at 2600, which is both a big round number and in the MIDDLE of the trading range we’re in.
1000am EST
Dollar breaks out and makes new lows, which should make the rest of the markets rise!
Crude Oil futures remain sideways around the big round number of 72.00, and we know this level is going to be the ‘pivot’ for us to be buyers or sellers.
We can see a bearish channel developed on the crude 13-range and we are trading at the LOWS of this channel, so we should be looking for a buy opportunity back into the channel highs.
If we continue to break below the channel on crude we will look for the next opportunity to sell short.
