MARKET COMMENTARY -Bullish backdrop remains. If you remember us teaching the OODA loop early last year, one of the primary things we must always be conscious of is ORIENTATION. Although the cycle moves from “Observe to Orient to Decide and then Act” – we are consistently in the cycle of orientation. Where are we with respect to the instrumentation? Healthy attention to support means the best thing for us as traders- engage long there– and pay attention if prices fail your front line of support. That number is now near 3254. The punchline remains that we are still bullish with the markets being juiced by the repurchasing window, so it means that our fades are “reversion to the mean” plays – where buyers will engage -just don’t try to pick the bottom. Complacency still abounds.
WEBINAR LINK IS IN THE PROTECTED AREA OF THE BLOG – Please login and scroll down for the link.
WEEKLY PRICE ACTION
Positive momentum holds us in a breakout pattern with a stall and a reversion to the mean in progress which we have likely attained in the overnight. We will know more when we see the bounce hold or fail. We closed last week above 3236 and currently sit above this region near 3268. It is reasonable to assume that buyers will engage at support levels noted but continue to keep watch for lower highs or the failure to hold nearby lows to signal a change of direction. Fades into weekly support areas noted will give us good engagement regions for long action.
INTERESTING SNAPSHOT from Koyfin -a ten-day look back
COMMODITY & CURRENCY WATCH
Gold spiked into 1613 before fading into 1560 where prices struggle to recapture at this time. Traders positioning for volatility continue to drive price higher. The US dollar is above key support zone- 96.6 as traders continue to trade in dollars for euros in the current cycle- I anticipate a price test of 97.4 again(accomplished overnight), as we did the Fibonacci study in our last webinar but it looks like we could have more. WTI exploded higher tonight but reverses into deep support regions near 59.27. Support sits between 59.27 and 61.2. Resistance levels sit near 63.5 to 66.97
TRADING VIEW & ACTION PLAN
We have a wave of a reversion to the mean under a bullish price environment. Pullbacks will be buying opportunities but we are potentially looking at choppy markets as traders digest moves. Broadly speaking, buyers still have an advantage above 3215. SIGNAL LIGHTS ARE GREEN-but watch those supports
The theme of INTRADAY motion is:
POSITIVE AS LONG AS WE HOLD ABOVE 3249ish today (with big spikes likely with shallow fades back into breakout)
CHOPPY BETWEEN 3215 AND 3242
NEGATIVE AS LONG AS WE HOLD BELOW 3231ish today (with sharp bounces failing and deep pullbacks holding)– choppy inside the range.
Follow short term trend and momentum signals while in the intraday trading environment and watch for weakness to develop away from your trade direction in order to leave. Please log in for the definitive levels of engagement today.
METASTOCK SWING SHORT – Complete and stopped out- very choppy environment if we are looking for engagement and hard stops
METASTOCK SWING LONG – No swing longs in play…intraday longs off support
Intraday LONG trading from support edges like the VWAP or solid moving averages will give you the least risk event for engaging.
Intraday SHORT trading from resistance edges like the old highs will give you the least risk event for engaging.
Follow the candle trend until candles stop breaking higher.
IF YOU HAVE THINKORSWIM, YOU CAN LOAD MY PRIMARY LEVELS EACH DAY FROM THIS LINK. Because levels change often, you’ll need to download these each day. I do not draw all secondary price levels on my charts-
NEW LINK FOR TODAY’S TRADING DATA EXCEL SPREADSHEET –
REMEMBER, WE ARE USING AGGRESSIVE ENTRIES IN THIS MARKET– If those levels have passed you, simply walk your targets up the levels noted on the spreadsheet as the next entry as long as trend prevails.
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