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We’re back in the action once again with a busy week of trading ahead of us…

Markets took a run lower today giving bears control of the short-term momentum, which means I’ll be looking for sell setups at three specific resistance areas waiting overhead. My only concern going into Tuesday is the strength of the pending pullback. Here’s what to look for…

E-Mini S&P (ES):

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E-Mini Keys to Success:

• Day began with a gap-down off last week’s highs, which turned into 3 legs lower into a sideways trading-range.
• Sellers will be looking for ways to get short at resistance levels above the range high
• Buyers will need to take back control of momentum with a 123-Reversal for a retest of all-time highs.

Best Trades for Tomorrow: 

• [UP] – buyer failure to sell (or) 123-Reversal to buy
• [DOWN] – 123-breakout to sell (or) nested failure to buy
• [SIDEWAYS] – sit on hands, wait for a breakout to buy low, sell high.

E-Mini Nasdaq (NQ):

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Nasdaq Keys to Success:

• Similar to the Emini ES – bearish trend ends in a range right on top of the previous all-time high from
• Sellers will be looking for ways to get short at resistance levels above the range high
• Buyers need to reverse momentum with a strong breakout higher to retake control.

Best Trades for Tomorrow:

• [UP] – buyer failure to sell (or) 123-Reversal to buy
• [DOWN] – 123-breakout to sell (or) nested failure to buy
• [SIDEWAYS] – avoid the middle, wait for a breakout and sell high with failures.

Gold Futures (GC):

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Gold Keys to Success:

• Day begins with a bull breakout above last Friday’s trading-range, but it fails and price completes a ‘pendulum swing’ with a strong run lower for the bears.
• Bears want to retest the recent lows and will be looking for ways to short tests of resistance levels overhead.
• Buyers need to see proof of a reversal before they try buying into such strong short-term momentum off the highs.

Best Trades for Tomorrow:

• [UP] – buyer failure to sell (or) 123-Reversal to buy
• [DOWN] – 123-breakout to sell (or) nested failure to buy
• [SIDEWAYS] – wait for a new range, then look for buyer failures to sell above the highs.