Will this Trade Work on Wednesday?

We’re back in the action after the Holiday break and the markets didn’t waste any time kicking off the Fall Trading Season with some big moves today…

The Emini and Gold both had strong runs lower into trading-ranges, so we’re “trading the rotation” while looking for breakouts and reversals on Wednesday…

Nasdaq is the outlier of the group, rotating back and forth inside a wide range; but a recent spike higher for the bulls gives the buyers an awesome opportunity for another leg higher…  Can they get it done?  Will the breakout trade work?

If you’re trading on Wednesday, you better watch tonight’s video…

E-Mini S&P (ES):

E-Mini Keys to Success:

• Sellers took price lower into a trading-range and sellers are now trying to complete a pendulum-swing rotation running lower.
• Sellers would love to sell the breakout-pullback if we keep pushing lower, but they need to beware selling into a bounce off this support trend-line.
• Buyers have a couple options – they can wait for a strong bounce off this support trend-line, or they can wait to buy exhaustion off support levels below the range.

Top 3 Trades for Tomorrow: 

• UP – buy the 123-Reversal (or) sell a 2-try failure
• DOWN – sell the breakout-pullback (or) buy the 2try reversal
• SIDEWAYS – sit on hands and wait for a breakout

E-Mini Nasdaq (NQ):

Nasdaq Keys to Success:

• Bears took price lower into a trading-range earlier today, and after failing to make new lows, buyers completed a pendulum-swing rotation and are now trying to breakout to new highs.
• Buyers have all the momentum, but trying to buy this pullback is a gamble.  I’d rather wait for another strong leg higher to confirm the breakout and look for entries going up to the target zone overhead.
• Sellers have an easy short if we can get this rotation going lower, but with all this momentum for the buyers, I’m weary of selling into a move higher until we see a failure off the highs.

Top 3 Trades for Tomorrow: 

• UP – buy the 123-breakout (or) sell the buyer failure off the highs.
• DOWN – sell the 2-try trap (or) buy the 2-try failure off range lows.

Gold Futures (GC):

Gold Keys to Success:

• Sellers took price lower on strength and finish the day at a major measured-move into a sideways trading-range.
• Sellers have control of momentum and will be looking for shorts up at resistance levels above the range, along with breakouts going lower.
• Buyers have to stay patient for a change in momentum or signs of exhaustion at major lows.

Top 3 Trades for Tomorrow: 

• UP – sell the buyer failure trap (or) buy the 123-Reversal
• DOWN – sell the 2-Try breakout (or) buy the 2-try failure off major lows
• SIDEWAYS – sit on hands, avoid the middle, and wait for a breakout.