Crude Oil Advanced Analysis 6:00am EST Get to your desk and complete the morning prep detailed above. The first reversal occurs between 6:30 and 7:00am when the traders in London are getting out of their trades, we are looking for a trading opportunity at this time. Beware that Crude Oil wants to move 100-ticks, so if it did that in London before 7am, it's not likely it will do it again at 7am. 7:00am EST This time of the session will likely be the High or Low of the day. A move is almost certain around this time, so BE READY. If we don’t see anything happen around this time something is wrong (such as waiting for news to be released), and we must investigate further. We look for the first reversal trading opportunity around this time because London traders are taking profit on their trades and the US traders are getting to. their desks. London will typically make 60-ticks of range from 3:00am to 7:00am, however has not made that move yet, keep that in mind for a price-reversal location. © SchoolOftrade.com 2013-2014 Page 1Question to ask at this time: * Did London achieve at least 60-ticks of range from 3:00am — 7:00am EST? © If more, we can expect a price-reversal to occur early in the session starting at 7:00am EST because there is a good chance that US traders were forced to participate overnight and they will be taking profit early in the US session. © Ifless, we may see a substantial move early in the US session because there is still work to be done, or traders may be waiting on something such as news to be released later in the session. Watch the price-reversal to occur at a 5-minute supply and demand zone and look for the entry on a 1-minute chart. Start counting for the “dollar-rule” at this time, one of the recent swing-highs or swing-lows will likely be the starting point of the next 100-tick move. Keep in mind the “dollar-rule” is most likely to begin at 9:00am EST however it may start as early as 7:00am EST. 8:00am EST You should already be in the move from 7:00am EST at this time. If the move has not occurred there is something wrong today with the price-action and we should investigate for more clues before trading ahead of the 9:00am EST Crude Oil opening-bell. © SchoolOftrade.com 2013-2014 Page 2ARON AG a a= ANDREYBBRV@GMAIL.COM SKYPE: ANDREYBBRY 9:00am EST This time of the day is the MOST important for Crude Oil trading because of the opening-bell reaction and the “re-set” of the trading session. We will look at 4 different things at 9:00am EST * Dollar Rule co Have we made at least 100-ticks of range since 3am EST when London opened? This will tell us what to expect at this time. © Opening Range: © First S-minutes (9:05am) of trading define the opening range for the session © Daily Targets ©. The first S-minute range will help us project targets for the day ahead. © Directional-Bias o The color of the 9:05am candlestick defines our directional-bias Dollar-rule (100-ticks): We know that Crude Oil loves to move in $1.00 (100-ticks) increments, so this is something to look at before the opening-bell rings. First, if we have made a move greater than 100-ticks (“dollar rule”) between 7:00am and 9:00am EST then we will expect to see a price-reversal around this © SchoolOftrade.com 2013-2014 Page 3time. Furthermore, if we don’t see this price-reversal we know the trend is VERY strong today. Second, if we have not made the 100-ticks (“dollar rule”) between 7:00am and 9:00am EST then we are open to both directions at this time and will use the directional bias from the 9:05am EST candle as described above. Opening Range: Using a S-minute, we define the opening range for Crude Oil as the first S-minutes of trading in the session, starting at 9:00am EST. Specifically, we are going to use the 9:05am EST Candlestick on a 5-minute chart. Watch closely as price-action trades INSIDE the opening-range because the highs and lows of the range are very important for trading opportunities. If we see price try to breakout to new highs and FAIL, we consider the market-sentiment to be very weak and will look to trade short. On the flip side, if we see a successful breakout of the opening range to the DOWNSIDE we will typically see price-action retrace back into the lows of the opening range and then move lower. A successful breakout of this opening range is defined by a candlestick opening and closing above the highs or below the lows on a 1-minute entry chart. We will be looking for trading opportunities around the highs and lows of the opening range. © Schooloft'r e.com 2013-2014 Page 4Daily Targets: Using the same 9:05am EST candle, draw the Fibonacci extensions from top to bottom and then bottom to top. Using this range we project the 233, 377, and 512 Fibonacci extensions. These levels will become profit-targets (combined with the 100-tick rule) later in the session. Directional Bias: Look at the 9:05am EST candle on a S-minute chart and define the candlestick as bullish, bearish, or neutral. This will define our directional bias for the early part of the trading session. If the 9:05am candle is bullish we want to look long, and if it’s bearish we want to look short. If we see a neutral candle (such as a doji) at 9:05am EST, then use the 9:10 candle to determine the direction in the same manner. 10:00am EST We begin looking for the traders who entered at 7:00am to begin to take profit and exit their positions, causing a price-reversal around 10:00am EST. First, If we have made a move greater than 100-ticks ("dollar rule”) between 7:00am and 10:00am EST then we can expect a price-reversal. © SchoolOftrade.com 2013-2014 Page 5TIA B ROIS Clave Second, if we have not made the 100-ticks (“dollar rule”) between 7:00am and 10:00am EST then we are going to try and stay in any open positions and stay patient to take profit after we achieve the 100-tick move. 11:00am EST We look to take our profit around this time of the session because Europe is closing its markets at 11:30am and the US traders who entered into trades earlier in the session will be taking profit before they go to lunch. Lunch begins around 11:30am EST and will last until 1:00pm EST, during which times we stay in open positions but tighten our stops, and do not enter into new positions until the afternoon session begins. Important Note: We are focused on trading the morning session of Crude Oil futures and trading the afternoon session is an easy way to give back profit you made in the morning session. Be careful trading the afternoon because it is a completely different market-personality than the morning session and must be traded accordingly. 1:00pm EST Traders return from lunch and begin looking for new trading opportunities. We don’t have much time in the afternoon as Crude Oil traders because the closing-bell rings at 2:30pm EST. © Schooloft'r e.com 2013-2014 Page 62:00pm EST We look to take our profit around this time of the session because Crude Oil futures volume will drop significantly at the 2:30pm EST closing-bell 2:25pm EST With the closing-bell just around the corner you will see a very quick trading opportunity at this time. Using a very small stop-loss and profit-target for a quick ‘scalp’ we will look at how the market did in the session to determine the trade to look for. Look for a buying opportunity if we have been trading lower all session as traders exit their short positions with buying orders on the tape. This is also referred-to as a ‘short-covering rally’. Look for a selling opportunity if we have been trading higher all session as traders exit their long positions with sell orders on the tape. Furthermore, keep an eye on the “dollar-rule” because we don’t want to enter into a new trade going against the dollar-rule, but we can certainly use the dollar- rule as a profit-target in this scenario. © SchoolOftrade.com 2013-2014 Page 73:00pm EST Take the time to review each trade you took. Look over your trading journal and ask yourself why you took each trade and look for ways you can improve for tomorrow. Important Note: Download Market Replay data for today before you finish so you can use it in the future to practice using Market Replay. Set-up your charts and workspace for tomorrow's trading session. Clean up the area at your desk, organize your notes, and create back-up copies of important documents from today. A clean workstation is a profitable workstation. Want to learn more about trading Crude Oil and how to set-up your charts to be ready to trade tomorrow? Contact our office to reserve your spot for the next Concierge Call Sales@SchoolOfTrade.com / 800.381.2084 © SchoolOftrade.com 2013-2014 Page 8