Curso de Trading de Brooks

Aprenda a operar con la acción del precio de forma consistente

 

More results...

Emini Bears Want 2nd Leg Down

By

Trading Update: Friday May 31, 2024

S&P Emini pre-open market analysis

Emini daily chart

  • The Emini formed a second leg down yesterday, following the May 23rd and a test of the April 29th high.
  • However, the Emini went sideways for three days following the May 23rd breakout.
  • This is a sign of trading range price action and more sideways trading.
  • Because the daily chart is in a trading range, the odds favor breakout points will get tested and closed. A logical breakout point to get tested is the April 29th high, and the market will probably reach over the next several weeks.
  • The bears are hopeful that the market is forming a higher high major trend reversal on the daily chart.
  • While a higher high major trend reversal is possible, more likely, the market is going to continue to go sideways in a trading range.
  • Because the market is more likely to go sideways, traders can wait for a credible lower higher major trend reversal, a head and shoulders top, before looking to sell.
  • Overall, the market is in a large trading range on the daily chart. This means traders should expect sideways trading for the next several days. Today will probably do something to disappoint the bears.

Emini 5-minute chart and what to expect today

  • The globex market formed a strong upside breakout during the 8:30 AM EST report. The rally is strong enough that the market will likely get a second leg up, even if there is a deep pullback first.
  • The U.S. session will probably form a trading range open and go sideways for the first several bars.  This means traders should consider waiting for 6-12 bars before trading.
  • There is an 80% chance of a trading range open and only a 20% chance of a trend from the open. This means there is an 80% chance that the open will form a variation of a double top/bottom or a wedge top/bottom.
  • Traders should try and catch the opening swing that often begins before the end of the second hour, after the formation of one of the above-mentioned patterns.
  • Traders should pay attention to yesterday’s high as it is likely a magnet.
  • Today is also the final day of the month and the week. This increases the risk of a surprise breakout late in the day as traders decide on the close of both the weekly and monthly charts.

Yesterday’s Emini setups

SP500 Emini 5-Min Chart Wedge Bottom Then Double Top

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

  • I will post update after market close.

Summary of today’s S&P Emini price action

SP500 Emini 5-Min Chart Bear Trend From Open Then Reversal Up

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.

>