Emini Test of September 26 High Likely

Trading Update: Wednesday October 16, 2024

End of day video review

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You can also watch Joseph’s EOD Review for today on his YouTube channel.

S&P Emini market analysis

Emini daily chart

• The Emini yesterday, after Monday, broke above the 5,900 round number.
• The September rally retested the August 26^th high breakout point. This means that traders will expect the market to rest the September 26^th high as well, which is part of the reason why yesterday reversed down.
• Because the channel up is sideways, the market may not go straight down.
• Today may form a disappointment bar for the bears and a high 1 buy signal bar may be set up for tomorrow.
• If tomorrow does form a High 1 buy signal bar, there will probably be sellers above it, and the Bears will get a second leg down.
• Overall, the odds favor a test down to the September 26^th high and possibly a test of the October low.
• The bears are hopeful that today will form another strong bear trend bar; however, they will probably be disappointed.

Emini 5-minute chart and what to expect today

• The Globex market formed a tight trading range for most of the overnight trading hours.
• The bears recently formed a downside breakout around 9:00 AM EST.
• The bulls want the recent bear breakout to lead to a final flag and reverse back into the tight trading range from the overnight session.
• Today opened with a very small gap and went sideways for the first six bars of the day. This increases the odds that there will be a lot of trading range price action on the open today.
• Yesterday was climactic, which means there is a 75% chance of a trading range lasting at least two hours beginning before the end of the second hour.
• The bulls formed a strong reversal on bars 7 and 8, creating a breakout and follow-through. This is strong enough that the odds favor a second leg up. The bears hope this will lead to a double top with the bar 77 high.
• The market is likely Always In Long and likely to get a second leg up. Bulls want a double bottom and break above the neckline (yesterday’s bar 77) and a measured move up.

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.

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

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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.

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