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Emini Strong Bull Micro Channel at Resistance

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Trading Update: Wednesday August 14, 2024

S&P Emini market analysis

Emini daily chart

  • Yesterday, a strong bull breakout was formed, closing above the daily moving above.
  • Yesterday, the bull breakout bar was strong, and the 7th bar was in a bull micro channel. This is a strong enough rally on the daily chart that the odds favor a 2nd leg up after any pullback. This will likely limit the downside of the first reversal attempt.
  • While the Bulls have done a good job with the 7-bar bull micro channel, the market is getting near the midpoint of the selloff down to the August 5th low. This increases the odds that bears will begin to sell, betting on a 2nd leg down and test of the August 5th low.
  • The bears selling know that the rally is strong and the odds favor a 2nd leg. They do not mind and will sell higher on a test of the All-Time High.
  • Overall, the bull rally is strong enough for a second leg. However, it is getting near resistance, the midpoint of the selloff down to the August 5th low. This increases the risk of a deep pullback before the bull’s second leg is down.

Emini 5-minute chart and what to expect today

  • The Globex market formed a large outside down breakout bar during the 8:30 AM EST report bar. This is a confusion bar within an overall trading range on the Globex chart. This increases the odds of a lot of trading range price action during the open of the U.S. Session.
  • The bears got a test down to the 8:30 AM report bar low during bar 9. However, the breakout failed, and the market reversed up with bars 10 and 11.
  • The bulls are hopeful that the reversal up from the 9 low will be the day’s low and lead to a test of the 8:30 report bar high.
  • At the moment, bars 10 and 11 look good, but they need follow-through. Without it, the odds are the market will go sideways.
  • Because the selloff down to bar 9 is a parabolic wedge at support, the 8:30 report bar low, the odds favor two legs up.
  • Because the channel down to the 9 low is tight, the odds favor sideways rather than straight up.
  • Bar 13 is a surprise breakout bar and is strong enough for a second leg down. The bears are hopeful that bar 14 is a strong follow-through bar, increasing the odds of a measured move down.
  • At the moment, the odds are the high of the day is in.
  • The bulls want bar 13 to be a 2nd leg trap, and 14 to form a strong bull reversal bar.
  • The bulls formed a strong reversal bar on 14. This increases the risk of a 2nd leg trap with bar 13. Always In Bears likely exit above 14 and will wait to see what the rally looks like.
  • The reversal up from the 14 low is strong enough for a second leg up. This increases the odds we have seen the low of the day.

Yesterday’s Emini setups

SP500 Emini 5-Minute Chart Double Bottom and Then Small PB Bull 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 Bulls are so far getting strong follow-through buying after yesterday’s bull breakout bar.
  • The Bulls are hopeful that the current breakout is strong enough to break above the December 2023 high. Next, they want a successful breakout of the July 2023 high, which is the top of the trading range that began in early 2023.
  • Traders will pay close attention to see how today’s follow-through bar closes.

Summary of today’s S&P Emini price action

SP500 Emini 5-Minute Chart Bear Trap Rally Then Trading Range

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.

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