Trading Pullbacks & Sideways Ranges

Wow, what a difference a day makes!

The bulls took control of our favorite markets today with some impressive runs higher, which means I’ll be looking for either deep pullbacks or sideways ranges to structure me entries on Thursday…

The key right now is identifying the best support levels to combine with our entry setups, here are the key levels I’m watching for tomorrow…

E-Mini S&P (ES):

E-Mini Keys to Success:

• Buyers reversed the trend today with a strong, 123-breakout running higher which completed four legs higher to finish the day.
• Four legs up tell us to expect either a deep pullback off these highs or a sideways range the following day.
• Buyers would love a deep pullback into a seller failure pattern to buy back up to the highs
• Sellers will be looking for a 123-Reversal to go back to Wednesday’s trading-range.

Best Trades for Tomorrow: 

• [UP] – 123-breakout to buy (or) crown reversal to sell
• [DOWN] – nested failure to buy (or) 123-Reversal to sell
• [SIDEWAYS] – wait for the range to develop, then buy below range using seller failure patterns.

E-Mini Nasdaq (NQ):

Nasdaq Keys to Success:

• Strong “rotation off the low” of yesterday’s trading-range gives bulls the momentum they need to reverse the trend and fall just short of completing three legs higher, ending the day on the psychological level of 13893.25
• Buyers will be looking for deep pullbacks to the low of the channel, or a developing trading range to buy below
• Sellers will need to stay patient for a reversal back to the range from yesterday.

Best Trades for Tomorrow:

• [UP] – 2-try trap to buy (or) crown reversal to sell
• [DOWN] – seller failure to buy (or) 123-Reversal to sell
• [SIDEWAYS] – sit on hands, buy below the range with seller failure patterns.

Gold Futures (GC):

Gold Keys to Success:

• Buyers broke free of the weekly trading-range and completed a large ‘pendulum swing’ going higher before trading sideways in a narrow range.
• Buyers will be looking to buy at support levels below this range, or buy bull breakouts going higher.
• Sellers can look for 123-Reversals going lower or wait for crown reversals to sell resistance levels above the range.

Best Trades for Tomorrow:

• [UP] – 123-breakout to buy (or) crown reversal to sell
• [DOWN] – seller failure to buy (or) 123-Reversal to sell
• [SIDEWAYS] – wait for the break below the range, buy with seller failures