Emini Bulls Want Trend Continuation

Trading Update: Friday January 19, 2024

S&P Emini pre-open market analysis

Emini daily chart

• The Emini gapped up and rallied, forming a bull bar closing on its high. The Bulls want yesterday to be the start of trend continuation.
• While this is a good bar for the bulls, it is a bull close in the middle of a trading range, which is a bad context.
• The middle of a trading range is generally the worst area to establish a position. This means the bulls will probably be disappointed with the follow-through over the next day or two.
• The bears hope that any rally leads to a failed breakout of the month-long trading range and a final flag.
• The bulls see the daily chart as a bull trend and the month-long tight trading range as a bull flag. They expect the market to lead to trend resumption.
• With the March 2022 high target not far above, the odds favor the market getting closer to it.

Emini 5-minute chart and what to expect today

• Emini is up 16 points in the overnight Globex session.
• The Globex market has been in a bull channel for most of the overnight and early morning session.
• The bulls recently formed a bull breakout of the bull channel on the 15-minute chart. As expected, the upside breakout failed, leading to a test down to the bottom of the bull channel.
• The bears attempt to get a downside breakout after the wedge top.
• Because of the selling over the past 45 minutes, it is reasonable to expect a second leg down on the open. However, if the Bears get a second leg down, they need to continue building selling pressure. Note that I am typing this at 9:15 EST.
• As always, traders should expect a trading range open and be cautious about trading the first 6-12 bars. Most traders should consider waiting for at least 6 bars before placing a trade unless they can make quick decisions.
• Today is Friday, which means weekly support and resistance is important. The open of the day is at 4,802 and the close of last week is at 4,816.5. Both of these might be magnets going into the close of today.
• Lastly, because today is Friday, traders should be ready for a possible surprise breakout late in the day as traders decide on the close of the weekly chart.

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.

EURUSD Forex market trading strategies

EURUSD Forex daily chart

• The EURUSD is going sideways after the January 16^th downside breakout. The Bears are hopeful that January 16^th is strong enough for a second leg down and a test of the December low.
• The bulls want the bears to buy back shorts and for the market to lead to a reversal and test up to the December high.
• The bears will try to form a gap with the January 5^th low. Next, they will try for a measured move down to the December low.

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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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.

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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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