For the Week of June 29, 2015
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.
Let’s focus on three contracts that have defined Trend Lines Formations.
Highlighting This Week’s Potential Breakouts:
There is a potential Momentum Entry Technique (M.E.T.) setup in the September 2015 Canadian Dollar contract. An M.E.T. trade occurs on a break out of a recent pivot point high or low with a corresponding market trend in that direction. The Trend Seeker (a U.S. Chart Company tool to help identify a market’s trend) is down. The MACD, a trend indicator, is slightly bearish below the baseline. The Stochastic indicator, a momentum indicator, is bearish as well. After trading to a short term low at .8039 (6/24/15), this contract has been trading sideways for a few sessions. A break of that low triggers a short entry opportunity. A stop loss could be placed above the recent contract highs from the recent sideways trading. A downside target could be the twelve month contract low of .7770 (3/18/15).
30-Year Treasury Bonds
The September 2015 30-Year T-Bonds contract failed to continue its downward momentum on the Greece news today. This creates a potential support level with the double lows at 147-16 (6/10/15) and 147-11 (6/26/15). On the rally today, the MACD, a trend indicator, and Stochastic, a momentum indicator, both turned bullish. There is an upward trend line with touches at 164-00 (4/17/15), 155-27 (5/29/15), and 152-06 (6/19/15). There is also smaller Channel Formation with the recent sideways trading activity. A break of the 152-06 (6/19/15) would trigger a long entry opportunity. A stop loss could be placed below the other side of the Channel Formation. A short term target is the next pivot point high at 155-27 (5/29/15). A longer term target could the 160-00 price level.
The August 2015 Heating Oil contract has formed an upper trend line with touches at 2.0684 (5/06/15), 2.0343 (5/18/15), 1.9548 (6/17/15), and 1.9374 (6/24/15). A close above the upper trend line and indicator confirmation will trigger a long entry opportunity. The Trend Seeker (a U.S. Chart Company tool to help identify a market’s trend) is down though. The MACD, a trend indicator, is slightly bearish below the baseline. The Stochastic indicator, a momentum indicator, is bearish as well. There is a lower support line, almost setting up a Flat Bottom Triangle Formation. As long as prices hold this support level in the 1.8200 to 1.8300 range and the market trades higher, the indicators should shift bullish. The upside target could be the top point on the trend line at 2.0684 (5/06/15). An additional trade confirmation would be the crossover of a 20-day and 50-day Moving Averages.
STOP ORDERS DO NOT NECESSARILY LIMIT YOUR LOSS TO THE STOP PRICE BECAUSE STOP ORDERS, IF THE PRICE IS HIT, BECOME MARKET ORDERS AND, DEPENDING ON MARKET CONDITIONS, THE ACTUAL FILL PRICE CAN BE DIFFERENT FROM THE STOP PRICE. IF A MARKET REACHED ITS DAILY PRICE FLUCTUATION LIMIT, A "LIMIT MOVE", IT MAY BE IMPOSSIBLE TO EXECUTE A STOP LOSS ORDER.
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