Trump corporate tax cut rally testing 2600 Big Round Number
Updated 6:47 a.m.
The Emini opened within yesterday’s 6 hour range. This increases the chances of a lot of trading range trading today. In addition, it reversed twice in the 1st 3 bars. This is more trading range trading, and it reduces the chances of a big trend day.
While the Emini is slightly more bullish than bearish at this point, it is mostly neutral. Most traders are therefore waiting for additional information. This could be consecutive big trend bars up or down, or a 2nd entry buy or sell signal.
Pre-Open market analysis
Yesterday was a small pullback bull trend day that broke strongly to a new all-time high. It spent the 2nd half of the day in a tight trading range. The bulls therefore will try to get trend resumption up today. The bears want a major trend reversal. While that is unlikely, if there is a strong reversal down, traders will swing trade their shorts.
Today is also a big travel day for Thanksgiving. Consequently, many traders will be thinking about other things, and the day is more likely to be a quiet day. As a result, yesterday’s tight trading range might continue through today.
When there is a buy climax like yesterday, there is a 50% chance of follow-through buying in the 1st 2 hours. However, there is only a 25% chance of a strong bull trend day. Additionally, there is a 50% chance of at least 2 hours of sideways to down trading that begins by the end of the 2nd hour.
Overnight Emini Globex trading
The Emini is up 2 points in the Globex session. It will therefor likely open within yesterday’s 6 hour tight trading range. This increases the chances of more trading range trading today. The odds still favor at least a small rally for trend resumption up from yesterday’s strong bull trend. If there is going to be a rally, it will probably begin within the 1st 2 hours.
Yesterday’s setups
Here are several reasonable stop entry setups from yesterday. I sometimes also show limit order entries and entries on the close of bars.
EURUSD Forex market trading strategies
The EURUSD daily Forex chart has pulled back for 6 days from a strong rally. The odds favor at least a test up to last week’s high. The bears want the 6 day pullback to continue into a reversal of last week’s rally.
The EURUSD daily Forex chart reversed down over the past week from a strong rally. The reversal down is not as strong as the rally. In addition, it is stalling at support. The prior highs and lows over the past 4 months provide support. So do the 50% pullback, the 20 day EMA, and the 20 week EMA (not shown). The odds are that the bulls will try to get a 2nd leg back up to test the October 12 major lower high.
The bears need a strong break below support, and especially below the November 7 major higher low. However, the strong bull trend on the weekly chart make the bear breakout unlikely without at least a double top with last week’s high or a stronger reversal down.
The past 4 days have had small bodies and ranges, and reversed every day. This is trading range price action. Therefore, the 6 day selloff is more likely a bear leg in a small trading range than the start of a bear trend. The odds favor a test back up within a week. However, yesterday and today have been small days. Furthermore, tomorrow is a holiday. The odds are that today will be another small day.
Overnight EURUSD Forex trading
The 5 minute chart has been in a 50 pip range for more than 24 hours. There is no sign of a breakout. While the odds favor a 100 pip rally back up to last week’s high, day traders will continue to scalp until the momentum up or down increases.
Summary of today’s S&P Emini futures price action and what to expect tomorrow
Today was a small trading range day that closed around the middle. It is a continuation of the pullback that began shortly after yesterday’s rally.
After a 2 day pullback from yesterday’s strong rally, the odds still favor at least a small 2nd leg up. However, Friday closes early and it will also likely be another small day.
See the weekly update for a discussion of the price action on the weekly candlestick chart and for what to expect going into next week.
Traders can see the end of the day bar-by-bar price action report by signing up for free at BrooksPriceAction.com. I talk about the detailed S&P Emini futures price action real-time throughout the day in the BrooksPriceAction.com trading room. We offer a 2 day free trial.
When I mention time, it is USA Pacific Standard Time (the Emini day session opens at 6:30 am PST, and closes at 1:15 pm PST). You can read background information on the intraday market reports on the Intraday Market Update page.
