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Emini Pullback to Moving Average Likely

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Trading Update: Thursday June 20, 2024

End of day video review

Brad Wolff Emini EOD Review

S&P Emini pre-open market analysis

Emini daily chart

  • The bulls have formed a strong rally since the May 31st bull reversal bar.
  • While the bulls have done a good job with the rally, it is becoming climactic and far from the moving average. This increases the odds of a pullback soon.
  • Tuesday formed a follow-through bar after Monday’s bull breakout. While this is good for the bulls, the follow-through bar is small and overlaps most of Monday’s breakout. This is a sign of weaker bulls and increases the risk of a pullback soon.
  • Today will probably form a trading range or a bear trend day. This means that there are probably sellers above Tuesday’s high.
  • If today rallies above Tuesday’s high, traders should be prepared for a possible reversal later in the day.
  • Overall, the odds favor a reversal down and test of the moving average. However, because the buying pressure is strong, the odds are against the bears getting a strong reversal down into a bear trend. This means a trading range is more likely and the market will probably begin to go sideways to the moving average and the 5,500 round number.

Emini 5-minute chart and what to expect today

  • Emini is up 11 points in the overnight Globex session.
  • The Emini sold off recently during the 8:30 AM EST Jobs report.
  • The bears are hopeful that today will close below the day’s open and form either a bear trend or a trading range day. This is due to the daily chart becoming climactic.
  • As I often say, traders should use caution when trading the open. Most traders will be better off waiting for clarity, which usually becomes after 6-12 bars.
  • By waiting on the open, a trader is giving up opportunity to have a higher probability of catching either the high or low of the day.
  • If today will become a strong trend day, there will be plenty of time to enter the trend. This means that there is no rush to enter on the open.
  • There is an 80% chance of a trading range open and only a 20% chance of a trend from the open.
  • Traders should try to 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.
  • The opening swing is important because it is common and often provides strong risk/reward while giving a trader decent probability.
  • The most important thing on the open is to be patient and be in a rush to force trades. If a trader is uncertain about what to do, it is best to step aside and wait.
  • Most traders have plenty of good trades to do well. However, they have too many bad trades with a poor trader’s equation. This, unfortunately, eats away at all the winning trades, causing the trader to not be consistent.

Tuesday’s Emini setups

SP500 Emini 5-Min Chart Wedge Bottom and Then Trading Range Day

Al created the SP500 Emini charts.

Here are reasonable stop entry setups from Tuesday (before yesterday’s US holiday break). 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 sold off today, closing on its low.
  • The bears are hopeful that the selloff to the June 14th low is strong enough for a second leg down.
  • If the market does get down to the June 14th low, there will probably be buyers below it.
  • The daily chart of the EURUSD is in a large trading range, and the market is getting near the bottom of the range. This increases the odds of a sideways to up reversals.
  • The bulls want tomorrow to have bad follow-through selling which would increase the odds of sideways trading.

Summary of today’s S&P Emini price action

SP500 Emini 5-Min Chart Bull Trap Then Bear Trending Trading Range Day

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.

  • In Thursday’s chart, any idea why Al marked a buy above bar 2? Quite a bit above the MA, first bar a big bear bar (although a small tail below). Does bar 2 show above-average bullishness, just because it’s a bull inside bar? What is the definition of above-average bullishness above the MA?

    • Actually, I take it back… bar 2 low was only 2 points above the MA, so not far above the MA and a credible buy.

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