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Strong Emini Consecutive Bull Bars

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Market Overview: S&P 500 Emini Futures

The weekly chart formed a strong Emini consecutive bull bars closing near their highs. The bulls want a retest of the all-time high and a resumption of the broad bull channel. The bears want a reversal from a lower high major trend reversal or a double top bear flag with August 1.

S&P500 Emini futures

The Weekly S&P 500 Emini chart

Emini Weekly: Strong Consecutive Bull Bars, Broad Bull Channel, Strong Emini Consecutive Bull Bars
  • This week’s Emini candlestick was a consecutive big bull bar closing near its high above the 20-week EMA.
  • Last week, we said that traders would see the strength of the pullback (bounce). If the bulls manage to create consecutive bull bars closing near their highs, the odds of a retest of the all-time high will increase.
  • Previously, the bears had a reversal from a higher high major trend reversal, a wedge pattern (Jul 27, Mar 21, and Jul 16) and a trend channel line overshoot.
  • They want a retest of the April 19 low, even if it forms a higher low. They got what they wanted.
  • They see the current move simply as a deep pullback and a retest of the prior high.
  • They want a reversal from a lower high major trend reversal or a double top bear flag with August 1.
  • The bears hope to get at least a small second leg sideways to down to retest the August 5 low.
  • The bulls got a reversal from a double bottom bull flag (Apr 19 and Aug 5).
  • They hope that the market is in the broad bull channel phase. 
  • They want a retest of the all-time high and a resumption of the broad bull channel.
  • If the market trades lower, they want the 20-week EMA to act as support followed by a second leg sideways to up.
  • Since this week’s candlestick is a bull bar closing near its high, it is a buy signal bar for next week.
  • The market can gap up on Monday. Small gaps usually close early.
  • The move up in the last 2 weeks formed one of the strongest pairs of consecutive bull bars (probably not seen since the Covid selloff).
  • Odds slightly favor the market to have flipped into Always In Long.
  • Traders will see if the bulls can create another follow-through bull bar testing near the all-time high.
  • Or will the market trade slightly higher but stall (maybe around the August 1 high area) and form a small pullback instead?

The Daily S&P 500 Emini chart

Emini Daily: Tight Bull Channel, Retest High or DT Bear Flag?
  • The market traded higher for the week with gaps and in a 10-bar bull microchannel.
  • Last week, we said that the profit-taking activity could have begun last week. If the bulls can create strong consecutive bull bars closing near their highs, it can increase the odds of a retest of the all-time high.
  • Previously, the bears got a reversal from a higher high major trend reversal, a large wedge pattern (Jul 27, Mar 21 and Jul 16) and an embedded wedge (May 23, Jun 28, and Jul 16).
  • The selloff moved almost 10% which may have reached the bear’s target.
  • The bears see the current move simply as a deep pullback and a retest of the prior high.
  • They want a reversal from a double top bear flag with the August 1 high or from a lower high major trend reversal.
  • At the very least, they want a small retest of the August 5 low, even if it forms a higher low.
  • The Bulls hope the rally is in a (broad) channel phase and want a resumption of the broad bull channel.
  • They got a reversal from a parabolic wedge (Jul 19, Jul 25, and Aug 5), a trend channel line overshoot and a double bottom bull flag (Apr 19 and Aug 5).
  • The move is in the form of a 10-bar bull microchannel. That means strong buying.
  • Traders expect at least a small second leg sideways to up after a pullback.
  • If there is a deeper pullback, they want a reversal from a higher low major trend reversal and the 20-day EMA to act as support.
  • So far, the move up is in the form of a 10-bar bull microchannel.
  • There may be buyers below the first pullback from such a strong bull microchannel.
  • The market may have flipped back into Always In Long.
  • For now, odds slightly favor the market to be in the sideways to up phase with minor pullbacks in between.
  • The move up from the August 5 low while strong, is slightly climactic.
  • The market may need to form a small sideways-to-down pullback before it resumes higher.
  • Traders will see if the bulls can continue to create follow-through buying.
  • Or will the market stall (around the August 1 high) and form a small pullback or a double top bear flag?
  • If a pullback forms, traders will see the strength of the pullback.
  • If it is weak and sideways (filled with doji(s), bull bars and holding around the 20-day EMA), the odds of another leg up to retest the all-time high will increase.

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