Trading Update: Monday June 17, 2024
S&P Emini pre-open market analysis
Emini daily chart
- The daily chart has two doji bars after last Wednesday’s upside breakout.
- Last Friday, formed a weak high 1 buy signal bar was formed on the daily chart. However, the context is bad for the bulls, and the signal bar is a doji. This increases the odds of sellers above last Friday’s high and the market getting a deeper pullback.
- The bears are hopeful that the rally up from the May 31st low is a parabolic wedge that will lead to two legs sideways to down.
- The rally up from the May 13th low is likely a bull leg in what will become a trading range. This increases the risk that the market will test back down to the May 31st low.
- The bears need to create more selling pressure if they are going to get a strong downside breakout.
- Without more selling pressure, the market will likely continue to go sideways and get closer to the moving average.
Emini 5-minute chart and what to expect today
- Emini is down 5 points in the overnight Globex session.
- The Globex market has gone sideways on the 15-minute chart for more of the overnight session. The Bears tried to get a downside breakout a couple of hours before the U.S. Open. However, they failed.
- Traders should expect the open of the U.S. Session to have a lot of trading range price action. This means that most traders should consider waiting for 6-12 bars before placing a trade unless they are able to make quick decisions.
- Most traders should try and catch the opening swing that often begins before the end of the second hour, after the formation of a double top/bottom, or a wedge top/bottom.
- Traders should pay attention to yesterday’s high as the market may try and test it due to it being a buy signal bar on the daily chart.
Friday’s Emini setups
Al created the SP500 Emini charts.
Here are reasonable stop entry setups from Friday. 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.
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.
Why buy above exhaustive buy climaxes? How would you know that they would become successful breakouts at that moment?
There is nothing as ‘knowing’ in PA and everything is in a fog of probability. The exhaustive buy climaxes which otherwise have a 60% probability of TBTL sideways to down is in fact only a 40% probability in SPBL trend. Add to that, the lack of good sell signal bars – it is very difficult to formulate a positive trader’s equation for the bear case.
Yes, you are right, “knowing” was not the right word. Good point about the change in reversal probability since SPBL and lack of good sell signal bars.
Hi Abir, I am studying Al from more then a year. I am looking for mentor who can teach me and clear my doubts. Can you help me out and be my trading buddy.
Time is definitely a constraint for me. So if the support forum cannot provide you the help that you are seeking, and you want my help still – you can drop a mail at aaaleoe [at] gmail.com citing your needs and we’ll see if it is a good fit.
Why was that big bear bar a signal that could be interpreted as a possible high of the day? Looking to formulate better Instructions for myself on reliable ways of fading a strong trend like this near the end of the day
I would also like to know. Especially because SPBL, and bear bar had no follow-through I was pretty convinced it was just a trap/PB.
The bear bar was preceded by several buy climaxes. It was a big enough surprise bear bar at the MM target that didn’t immediately and evidently become a trap. It was also the first instance a gap was created and filled late in the trend. That said, predicting possible high of the day/low of the day candidate is not a high probability bet. Personally, I would only look for shorts after the LH DT when the market failed to create a new high and didn’t test the EMA in an SPBL trend 50 bars in.
Hello Brad,
Today, with the contract change, all my drawings (my analyses on different chart frames) got messed up. Does this happen to you? How do you deal with this situation?
Thanks.
Hi Leonardo,
We just need to plan for the rollover and move objects, etc, when the change takes place. It is a necessary ritual for me each time. 🙂
Screen capture screens and make notes if needed before the change.