Wednesday Trade Plan | SchoolOfTrade Newsletter 11/15/16

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Crude Oil is bullish and trading at the completion of both a measured-move and a bull wedge, the E-Mini S&P is bullish after a strong breakout of a triangle, Gold is range-bound and trading at the high of a triangle, Euro is bearish and trading with a spike & channel, and the FDAX is bullish and trading at the measured-move and at the high of a bull channel this evening.

Crude Oil is bullish and trading at the completion of both a measured-move and a bull wedge this evening which tells us the bulls have control, but the most reliable buying opportunities will come after a deep pullback off the highs to allow buyers to participate in this bullish trend without buying the highs.  Sellers need to stay patient at this point, waiting for a strong move lower that can hold a pullback, and beware trading into tomorrow’s Inventory Report at 10:30am EST.

E-Mini S&P is bullish after a strong breakout of a triangle from earlier today, but now we’re trading at the highs of a channel (spike & channel) as the bulls are trying to finish off a ‘Double-Up’ and possibly a test of all-time highs and a triple measured-move tomorrow.  The buyers will want to be involved with this move, but wise traders won’t be looking to buy the highs unless they have the stomach for a deep pullback, so when I find myself in situations like these I focus my attention on looking for traps.  Buyers will be watching all of the prior swings as this market moves higher, looking for buying opportunities as sellers try to reverse the trend, allowing them to buy into their stops.  Sellers have a tough road ahead of them because a deep pullback will still be seen as a buying opportunity at the many levels of support waiting below.

Gold is range-bound and trading at the high of a triangle this evening which tells us to look for selling-opportunities with buyer-failures off the highs, buying opportunities with seller-failures off the lows, and avoid the middle tomorrow until this market can find a way to breakout of this range.  Remember, the majority of breakouts fail, and the only time we can trust a breakout is when we see extreme strength and then holding a pullback outside the range, so stay patient if you’re looking for a breakout tomorrow and focus on fading the extremes using failures.

Euro is bearish and trading with a spike & channel this evening, which tells the sellers to focus on selling with buyer-failures and traps at resistance swings overhead with a target back to re-test the low.  The most important thing to remember when we see a market ‘grinding lower’ like this is avoid selling the low, stay patient to see price push above prior swings, and then look for the counter-trend buyers to fail.  On the flip side, the buyers will be waiting for a strong push higher that can hold a pullback before they can look for buying opportunities going back to re-test today’s high and possibly fill the weekend gap which is still left open from yesterday.

FDAX is bullish and trading at the measured-move and at the high of a bull channel this evening.  The bulls have control, but wise traders won’t be looking to buy into this resistance so the most reliable trading opportunities will come with a strong breakout-pullback above the channel high, or seller-failures at the rising support trend-lines listed below.  Sellers need to see a strong break lower and then manage to hold below the low of the channel for an opportunity to run back to the lows.