May 19, 2011
Sideways Ranges show lack of direction and future opportunities on Crude Oil and Gold
Wednesday afternoon we got the Fed’s Meeting Minutes (report here) and it basically told us what we already know. The Fed intends to improve its monetary policy over the next few years, it will likely raise interests early in 2012 (if not sooner), and they said it will take ‘years for the balance sheet in the US to return to normal’. Again, this is nothing we haven’t heard before…but the BIG thing was the fact they identified early 2012 when they will be raising rates…let that be an early clue for things to come.
Lack of specifics in the meeting minutes last night left the markets looking for more, which is leading to Dollar, Euro, Crude and Gold all trading in narrow sideways ranges around their big round numbers.
Looking at the news this morning we have a busy day ahead of us. Starting with Jobless Claims at 830am, then we have three events all at 10:00am today. Existing Home Sales, Philly Fed, and Leading Indicators are all released at the same time today. Following that we have a minor 10:30 Natural Gas Report which will wrap up our morning. We tend to see price action slow down after the 10:30 news on Thursdays so I will be watching for when the market is too dangerous to trade later this morning around 10:45.
With our day planned ahead, now I can review the basics on the markets im going to be watching today. The first step is to find a nice slow timeframe to show me the most important price levels.
I start my day with the Dollar Index because this will give me clues to the market’s personality and overall direction today. I can see the DX 06-11 Contract is trading sideways in the middle of the range from 76.195 down to 75.000. Later this morning I will zoom in on a faster timeframe (13range) and look at the current short term price action to see where the best times and location to trade will be.
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| Dollar Index |
Now lets look at Crude Oil Futures, which need to be rolled forward today. Contract Rollover occurs every month on crude oil and its very easy to complete rollover, we will cover this in our training for members as well.
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| Crude Oil |
