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Emini Is in Breakout Mode

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Trading Update: Tuesday March 19, 2024

S&P Emini pre-open market analysis

Emini daily chart

  • The Emini gapped up yesterday, testing near the March 12th high close, and found sellers. The daily chart is forming a tight trading range, which is a breakout mode pattern.
  • Traders are becoming less interested in buying far from the moving average. This increases the odds that the market is likely to go below the moving average soon.
  • If bulls expect the daily chart to fall below the moving average, they will be unwilling to establish long positions until they see the test of the moving average.
  • Traders are not expecting a strong breakout below the moving average.
  • The bears need to get two strong closes below the moving average or 3-4 average bars closing below the moving average before traders will consider the bears being in control.
  • This means that the best the bears can likely hope for is a trading range.
  • Overall, the daily chart is in a tight trading range, which is a breakout mode pattern. This means that the probability is close to neutral for both the bulls and bears. However, the market has been above the moving average for more than 18 bars. This means that the odds slightly favor the upside breakout of the tight trading range.

Emini 5-minute chart and what to expect today

  • Emini is down 19 points in the overnight Globex session.
  • The Globex market went sideways for several hours during the overnight hour and led to a second leg down during the early morning hours.
  • The bears are hopeful that today will gap down during the U.S. Session and lead to a bear trend day.
  • More likely, the U.S. Session will be a trading range.
  • As I often say, traders should expect a trading range open. This means that most traders wait for 6-12 bars before placing a trade.
  • Most traders should try to catch the opening swing that often begins before the end of the second hour. Traders can wait for a double top/bottom, or a wedge top/bottom before placing a trade in order to catch the opening swing.
  • Overall, the Emini has been in a trading range for weeks. This will cause traders to pay attention to yesterday’s low betting that there are buyers not far below.

Yesterday’s Emini setups

SP500 Emini 5-Min Chart Higher High Double Top and Then Weak Bear Trend

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.

EURUSD Forex market trading strategies

EURUSD Forex daily chart

  • The EURUSD is getting the second leg down following the March 14th downside breakout.
  • The bears are hopeful that they can get down to the March 1st low.
  • The bulls see the current selloff as a test of the March 1st buy signal bar high.
  • The rally up from the February 14th low is in a tight bull channel, a breakout on a higher time frame. This will increase the odds of a trading range and not a bear trend.

Summary of today’s S&P Emini price action

SP500 Emini 5-Min Chart Double Bottom and Then Small Pullback Bull Trend

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.

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