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Weekly Emini Big Bull Bar

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Market Overview: S&P 500 Emini Futures

The market formed a weekly Emini big bull bar closing near its high. The bulls need to create follow-through buying following this week’s strong breakout to increase the odds of testing the trend channel line. The bears see this week’s big bull bar as part of a developing buy climax.

S&P500 Emini futures

The Weekly S&P 500 Emini chart

Emini Weekly - Wedge, Embedded Wedge, BO or Buy Climax, Weekly Emini Big Bull Bar
  • This week’s Emini candlestick was a big outside bull bar closing near its high.
  • Last week, we said that traders would see if the bears could create another follow-through bear bar or if the pullback would stall around the 20-week EMA area and the weekly candlestick close with a long tail or a bull body instead. The odds slightly favor the pullback to be minor and not lead to a reversal.
  • The market traded slightly lower on Monday but gapped up sharply on Wednesday with follow-through buying for the rest of the week.
  • The bulls see the market as being in a broad bull channel.
  • They got another leg up, completing the wedge pattern (Mar 21, Jul 16, and currently Nov 8) and the embedded wedge (Aug 30, Oct 17, and currently Nov 8).
  • They need to create follow-through buying following this week’s strong breakout to increase the odds of testing the trend channel line.
  • The bears want a reversal from a large wedge (Mar 21, Jul 16, and Nov 8) and an embedded wedge (Aug 30, Oct 17, and Nov 8).
  • They hope that the recent sideways candlesticks (end of Sept to early Nov) will be the final flag of the move.
  • They see this week’s big bull bar as part of a developing buy climax.
  • They want a failed breakout followed by a pullback to retest the bottom of the possible final flag or the 20-week EMA.
  • They need to create consecutive bear bars closing near their lows to increase the odds of a deeper pullback.
  • Since this week’s candlestick is a big outside bull bar closing near its high, it is a buy signal bar for next week.
  • The market may still trade slightly higher.
  • Because the week closed near its high, the market may gap up on Monday. Small gaps usually close early.
  • Sometimes, the candlestick after an outside bar is an inside bar or has a lot of overlapping range.
  • For now, traders will see if the bulls can create follow-through buying following this week’s strong breakout into new all-time highs.
  • Or will the bulls be disappointed with poor follow-through buying over the next few weeks instead?
  • Odds continue to slightly favor sideways to up until the bears can create credible selling pressure (strong bear bar with follow-through selling).

The Daily S&P 500 Emini chart

Emini Daily - Wedge, Embedded Wedge, Buy Climax
  • The market traded slightly lower early in the week followed by a big gap up on Wednesday with follow-through buying on Thursday and Friday.
  • Previously, we said that traders would see if the bears could create strong bear bars with follow-through selling or if the market would stall sideways in a shallow pullback, followed by a breakout into new all-time high territory instead.
  • The bulls got the third leg up to complete the large wedge pattern (Mar 21, July 16, and currently Nov 8)
  • They also got the third leg to complete the embedded wedge (Aug 30, Oct 17, and currently Nov 8).
  • They see the market being in a broad bull channel and want the move to continue for many months.
  • If there is a pullback, they want the 20-day EMA or the bull trend line to act as support.
  • The bears want a reversal from a higher high major trend reversal.
  • They see a large wedge pattern (Mar 21, Jul 16, and Nov 8), an embedded wedge (Aug 30, Sep 25, and Nov 8) and a possible final flag forming (end of Sept to early Nov).
  • They see this week’s strong move up as part of a developing buy climax and want a deep pullback lasting a few weeks.
  • The problem with the bear’s case is that they have not yet been able to create strong bear bars with sustained follow-through selling.
  • They need to create consecutive bear bars closing near their lows trading far below the 20-day EMA to show they are back in control.
  • Until they can do that, traders will not be willing to sell aggressively.
  • For now, the market remains Always In Long.
  • The market may trade slightly higher still.
  • Traders will see if the bulls can continue to create follow-through buying.
  • If they do, especially a strong bull microchannel lasting many bars and moving in a (near vertical) strong spike up, it could be forming a buy climax.
  • Or will the market start to stall in the next few weeks instead?

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