Our Favorite Trades For The Rest Of This Holiday Week

OK, welcome back gang. I’m excited to announce that this is going to be my last video of the week. The reason why I’m excited to announce that is because I just found out that my son is coming in from the United States Marine Core and is going to be spending the holiday with me here. None of us are going to be trading Friday anyways so consequently I’m going to be looking forward to spending time with him. I’m going to go ahead and do this video for tomorrow and Friday’s thoughts and then spend a lot of time with my son. As you guys know, he was on a special assignment and I haven’t been able to see him for a while here. I’m really looking forward to spending the time with him.

Keep Your Trailing Stop Tight During Trades in the EURO Tomorrow

So let’s go ahead and take a look at the EURO. The first things that you should know about the EURO is that we are a little bit overextended from a stochastic perspective. What that means in English to us is typically what should happen is the market should come right back down here (on my charts at 1:10). However, we are in pre-holiday trade, so I have seen occasionally where there will be a situation where the market will try to blast off. I would be very careful of this blast off. If we do get a move through 13600 please keep that trailing stop very tight because you don’t want a situation similar to this over here (on my charts at 1:29) where we get a quick pop through only to get reversed on. Since we are a little bit under the 13600 were going to use up a little bit of energy to get up to that area and that is just going to put us deeper into the overbought area.

Layers of Accumulation in CL

CL was the flavor of the day. That is what I was trading in the Live Trading Room and it was the key focus for this morning. With CL it is important to understand that we were trapped here between falling resistances on the daily chart and then we had accumulation bars in here (on my charts at 2:05). This led to a little bit of a rough ride. The key focal point here that we were looking at trading was the 9380 level using our 80/20 rule. So once we got to the 9380 level we’re looking for the shorts and that worked out really slick for some of the people that were patient and waiting for the 9380 level to break. Looking at this going into tomorrow and Friday, really I’m looking to see about these accumulation areas. We’ve got one accumulation are here (on my charts at 2:38) two, three, four. So we have multiple layers here of accumulation. The first things I want to see is if we can push through this 9300 level then we’ve got some room to grow to right around the 9350. Now, if we break 9350 then that really sets us up for a fantastic opportunity down to around the 9000. So CL will once again be on tap for tomorrow.

Focusing on GC Tomorrow and Keeping Our Profits, Not Giving Them Back

In GC, remember it is basically rolling over to the G14 contract so keep that in mind if you’re trading. The volumes will really be moving over there soon. As far as the G4 is concerned you can see we’ve got some distribution above us from today’s bar but we’ve still got the accumulation that really held us today (on my charts at 3:34). You see that accumulation bar has really been a source of consternation and stress on this market the past few days. With that being said, I’m going to be looking for short-side trades down below today’s low. So the 12400 level. I will be watching out for snap back. In other words, I will be just a little bit closer on the trailing. So instead of letting it run 50% or, let’s say, 20-30 ticks and then trailing it 50% (so 10 or 15 ticks behind) I’m going to trail it a little bit tighter (like 75%-80%) because I don’t want to give anything back going into this accumulation bar. You can always look for a reentry if we start pushing down and it falls down and starts to snap back. I can look for fresh reentry opportunity. What we don’t want to have happen is it comes into this area, stops, and has a massive reversal (on my charts at 4:23). We’ve seen multiple cases of that in the recent past in some instruments. That can be hazardous to your financial health if you get caught in one of those. So, why turn a great winning trade into a loser? So that is going to be a focus going into Wednesday and Friday. Also don’t forget today’s bar was a distribution bar. When we get back above that 12600 area we could have a speed line to 20MA type trade. Which is about 150+ above us. So, some great movement on both CL and GC to focus on.

Keeping an Eye on the Stock Index Futures

Now, as we look toward the stock index futures here are my thoughts on this. Right now we’ve had a double doji star type day. We’ve had two consolidation days here pre-holiday. If we’re going to get a move typically we would see that tomorrow. We’re going to be watching to see if we can break above the distribution bar set forth here on Monday. Also, we’re going to be looking for short-side trades if we can get the four stock index futures below the fast speed line. I’ll be aggressively looking for shorts if we can get them down below the slow speed line on the all of the stock index futures. Remember, we’ve been climbing up here on the wall of worry if you will but we’re making a negative divergence (on my charts at 5:45). If that comes off and especially if we get holiday lightened trades where it could potentially be one sided trade, that could lead to very big moves very fast if nobody’s there to take the other side of the trade. So that is going to be something I’m going to watch particularly Wednesday. Again, Friday I don’t plan to be here at all. I’m going to be spending a lot of quality time with my son and Friday’s just not worth it from an economy scale perspective. So we are going to really focus and see if we can get that move tomorrow.

Looking at the Aftermath in the British Pound

As far as the other instruments, we talked about the British Pound in last night’s video and we kind of see the ramifications of that following through today. If you recall what I mentioned to you is that we had this key reversal down situation (on my charts at 6:29) where it was a full blown key reversal down. It opened up higher than the previous day’s high. The low and the close was well below the low of the previous day. It was a nice full blown reversal bar. However, you’ll notice what I mentioned to you in last night’s trading video was that we went ahead and stop right at the speed line. So the problem was that unless we can get down below the low of this bar (on my charts at 6:52) I’m not going to be interested in looking for follow through shorts. In order to find a continuation trade we have to get below today’s low. You see what happened is that we actually opened up at the speed lines, traded down just a little bit to sucker in some shorts, we weren’t thinking about the bigger picture here and then reversed it right back off. So that is a nice follow up to that discussion from last night. You see those concerns kind of coming to fruition there. I wanted let you see the before talk and the aftermath.

Your Homework for the Holidays

Speaking of that, what I would encourage so many of you to do (since we have a lot of student family members join us here and we’re going to have a couple of days off because of the holiday) is to go back to the past four weeks’ videos. It won’t take you that long as the videos are around 5-10 minutes long. Just go through the last months’ worth of videos and play those videos forward. See about all the things we talked about and how they came together. Watch the Premium Day Trading and Premium Swing Trading videos. Learn as much as you can. You can learn more in a month from most of our Premium Day Trading videos about trading then you would learn in many educational places throughout the internet in your entire time with this. What a great opportunity to take a couple of days here at the holiday to really grow from those. Since many of you took advantage of that special offer that we mentioned in the nightly video emails. So do that and I want to wish you all a fantastic and Happy Thanksgiving! Safe holiday travel. Sarah and I and our entire BBT Team will be looking forward to seeing you in the weekend videos for next Monday’s trading. We also look forward to a great Christmas holiday seasons with lots of great trading to come. You have a fantastic night and we’ll see you on the flipside.

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