Wednesday’s Setups
December
copper
(
HGZ1 |
Quote |
Chart |
News |
PowerRating) has had some
violent whipsaw, gapping action over the past few weeks in what appears to be a
struggle to find a bottom. As suggested last night, a tail that tested the
recent low and closed on its high “followed through” today. But
today’s bar is significant since it closes the three whip-saw gaps since the
10/22 low and finishes at a nine-day closing high in an expansion bar, its best
gain in five weeks. Although it will not appear on the Momentum 5 or New 10-Day
High Lists, the powerful finish and fact that copper nearly matched its highest
close in 10-days provides an argument to enter on an Off The Blocks,
an entry strategy normally reserved for markets with more demonstrative
momentum. If stopped out of an OTB or if the market opens lower, the initial
test points (for long entries on a pullback) are 63.40 and then 63.20 to 63.15.
The argument for the “nascent momentum” and bullish scenario is
defeated on intraday closes below 62.35. Obviously there is ample overhead
resistance, but if this market has guts, it will clear the October consolidation
zone and trade to 64.80. A move to the next level at 65.30 will likely cap any
continuation rally in the short-term.
After tapping out at secondary resistance spelled out in
the Nightly
Futures Report from 19 October in the .6090 to .6110 area (high for
both the Nov. and Dec. contracts was 2 1/2 ticks higher at .6220 on 10/25),
unleaded gasoline
(
HUZ1 |
Quote |
Chart |
News |
PowerRating) tagged contract lows today. The wave
pattern here suggests another healthy move to the downside is still in store.
The double bottom pattern remains an inflection or change zone, and an area we
closed at. Aggressive players will get short on an opening range breakdown below
the inflection. If stopped out, test a pullback from lows at .5890 to .5900 and
again at .5950.
T-bonds
(
USZ1 |
Quote |
Chart |
News |
PowerRating) have continued their
march higher since the defeat of the bearish case mentioned in
this space for Oct. 23. The next resistance tests reside at 107 21/32, then
109-even, before a bigger test at 110 25/32.
|
Contract
|
Symbol |
Setup |
Direction |
Trigger |
( HGZ1 | Quote | Chart | News | PowerRating) |
Nascent Momentum |
Up |
Off The Blocks, or pullbacks |
|
| Unleaded gasoline | ( HUZ1 | Quote | Chart | News | PowerRating) |
Continuation short |
Down | Breakdown of .5680 or pullbacks |
( USZ1 | Quote | Chart | News | PowerRating) |
Continuation long |
Up |
Cover and test short-term counter-trend short at 109-even |
Define your risk before entering and honor it.