Emini Second Leg Up Likely

Trading Update: Tuesday May 7, 2024

S&P Emini pre-open market analysis

Emini daily chart

• The Emini is getting a bull breakout of the bear flag (April 19^th low and April 29th high). At the moment, the market is Always In Long, and will likely get a second leg up.
• The bulls are hopeful that today will become another strong bull bar closing on its high.
• The bears want to prevent the bulls from getting a bull bar closing on its high. They are hopeful that today is a bear reversal bar closing on its low. Even if the bears get a close below the open, the odds favor buyers below and a second leg up on the daily chart.
• The selloff down to the April low is the first major trendline break of the bull trend and, therefore, likely to become a minor reversal. This means that the odds favor a retest of the highs and the completion of a major trend reversal.
• Overall, the daily chart is Always In Long and likely going to get a second leg up.

Emini 5-minute chart and what to expect today

• The Emimi is going to gap up on the open of the U.S. Session.
• The Globex market has gone sideways for most of the overnight session and rallied a few hours before the open of the U.S. Session.
• The bulls want a second leg up due to the open likely getting a gap up.
• As Always, traders should expect a trading range open and for the market to go sideways and get closer to the moving average.
• Yesterday’s high is a likely magnet today, and the bears will try to test it during the first two hours of the open.
• The bears want a bear trend from the open that will last all day. However, it is more likely that the selloff that forms will be brief, finding support at the moving average and yesterday’s low.  

Emini Intra-Day Update

• The bears are trying to get an opening reversal and a bear trend from the open. However, as of bar 4 they have not done enough.
• A trading range open is more likely than a bear trend from the open.
• The bulls are trying to form a wedge bottom with bar 7. At the moment, the 20–period moving average and Yesterday’s high will both likely act as support levels.
• Today rallied, forming a wedge top with bar 49, and sold off strongly to the open of the day on bar 52. Bar 52 is enough of a surprise that the odds favor a second leg down and a test of yesterday’s high.

Yesterday’s Emini setups

Al created the SP500 Emini charts.

Here are reasonable stop entry setups from yesterday. I show each buy entry bar with a green arrow and each sell entry bar with a red arrow. Buyers of both the Brooks Trading Course and Encyclopedia of Chart Patterns have access to a near 4-year library of more detailed explanations of swing trade setups (see Online Course/BTC Daily Setups). Encyclopedia members get current daily charts added to Encyclopedia.

My goal with these charts is to present an Always In perspective. If a trader was trying to be Always In or nearly Always In a position all day, and he was not currently in the market, these entries would be logical times for him to enter. These therefore are swing entries.

It is important to understand that most swing setups do not lead to swing trades. As soon as traders are disappointed, many exit. Those who exit prefer to get out with a small profit (scalp), but often have to exit with a small loss.

If the risk is too big for your account, you should wait for trades with less risk or trade an alternative market like the Micro Emini.

Summary of today’s S&P Emini price action

Al created the SP500 Emini charts.

End of day video review

End Of Day Review will be presented in the Trading Room today. See below for details on how to sign up.

See the weekly update for a discussion of the price action on the weekly chart and for what to expect going into next week.

---

Trading Room

Al Brooks and other presenters talk about the detailed Emini price action real-time each day in the BrooksPriceAction.com trading room days. We offer a 2 day free trial.

---

Charts use Pacific Time

When times are mentioned, it is USA Pacific Time. The Emini day session charts begin at 6:30 am PT and end at 1:15 pm PT which is 15 minutes after the NYSE closes. You can read background information on the market reports on the Market Update page.

---