For the Week of July 14, 2014
The Trade Spotlight advisory service applies the GBE trading methodology (buying or selling commodity contracts based on breakouts of chart formations and technical indicators) to identify one to two trade setups per week.
Highlighting This Week’s Potential Breakouts:
Using the Momentum Entry Technique (M.E.T.), the September 2014 Euro Currency is setup for a buying opportunity. A break of the 1.3705 (7/01/14) pivot point high triggers a long entry. The Trend Seeker (a U.S. Chart Company tool to help identify market trend) is currently neutral. The MACD, a trend indicator, is bullish as well, but mostly flat. In order for trade confirmation, the trend must be bullish. At this time, there isn’t much momentum to the upside either as the Stochastic indicator is flat. Before a breakout occurs, the 20-day Exponential Moving Average would cross over a 50-day Moving Average, resulting in a bullish signal. A potential stop loss can be placed below a lower trend line with touches at 1.3516 (6/12/14), 1.3517 (6/16/14), 1.3579 (7/07/14), 1.3592 (7/10/14), and 1.3595 (7/11/14). A potential target is the 1.3986 (5/08/14) twelve-month contract high.
Also using the Momentum Entry Technique (M.E.T.), the September 2014 Heating Oil contract could be purchased on a breakout through the 2.9198 (7/10/14) high. The Trend Seeker (a U.S. Chart Company tool to help identify market trend) is currently bearish. The MACD, a trend indicator, is bearish as well. The Stochastic indicator, a Momentum indicator, is in the “over sold” territory. There appears to be solid support along in between the 2.8400 and 2.8600. There are numerous instances where the contract has bounced off prices in that range. Additionally, factoring in the seasonal tendencies, the Heating Oil futures tend to rise in price in the month of September. Ideally, the technical indicators change bullish before a trade entry.
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