Rob Looks At The Market From A Different View Tonight

Welcome back everyone. I have a quick update for you tonight in a little bit different graphical format. First thing’s first is on the Euro when we go back into last year. Last time we had a close above this down trending channel right at the end of June beginning of July time frame. Since that time, we’ve had multiple hits and for a very long time I’ve been commenting on the Euro and even back here when we broke above just intraday I commented one day doesn’t make a trend and we need to have two closes back above to say we might have a reversal instead, but we had a close down below and made what we call a Hoffman Inventory Retracement Bar closing 45% or more off the high and that was all she wrote back to the downside. Here we are again testing those areas and are continuing to fail and that’s why my focus has been short side still to this day on the Euro. It won’t be until we get two bars back above this channel where I’ll have any sort of great optimism to see some more swing trade based longs as we continue on here.

Gold is going to be something similar. I would like to see two bars close below this inventory retracement bars or two bars back above over here, because both of these inventory retracement bars are just big fat resistance levels until they are broken and what I’m really looking for here is two bar close above the channel or below the channel. When we get these multi-bar closes below the channel it usually leads to some good shorting and when we multi-bar closes back to the upside it can lead to some movement, but right now we are just whipping back and forth in this channel. I need a little bit more to see with Gold before doing anything there.

Similar situation as well in Crude Oil. If we go to Crude back in August of last year since we had one bar close back above then you’ll notice numerous tests of the channel over and over again. Same thing that we’re having now. We’ve had multiple attempts trying to break the top end of that channel and have each one close back down under there, and we finally had one bar break above there where we wanted just a second one and finally have some major buy side activity in crude oil where we fell back into that channel and held once again in today. I’m looking for either multi-bar breakdown to the downside or the upside, which I would prefer the upside. What I am looking at this for is all the opportunity back to the upside. That could be some huge short covering rallies and buying some off of these lows where you have a positive divergence over here and put on some of your favorite indicators you’ll see we have a nice positive divergence here as well. I would like to see us move back to the upside with some good head rippers and that would be pretty fun.

Here is the RUSSELL and you’ll notice how well the RUSSELL has been doing holding the channel, and even today right to the midpoint of the channel coming back to close right near its high.

The S&P is sucking wind and is really getting beaten around inside and just below the channel.

Same thing with the DOW, you’ll notice we’re below the channel, and also with the NASDAQ. So you see we have a 3 to 1 scenario here and the RUSSELL holding strong and the other 3 markets are very weak. We either need the other three to join along and that could lead to some great long side trades, or we need the RUSSELL to capitulate and see all the other market drop to the ground fast. If you look at the overnight session for the RUSSELL it took just the 800 contracts to drop this thing a huge amount last night very fast, where in the middle of the trading session today it took several thousand contracts rather than 8. So we have to let that fight sort itself out and focus on the RUSSELL rather than the other three that are all sitting down below. Someone is going to lose that battle and those other three are going to spike heavily back up and join the RUSSELL and this whole thing will tear to the upside and lead to great buy side opportunities or all four of them could capitulate and they fall out of bed together. You all have a great evening and I will see you tomorrow morning in the live trading room or tomorrow evening in the nightly videos. Take care everyone.

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