Posted 7:45 am PST.
Yesterday ended with consecutive sell climaxes in a tight channel, so 2/3 chance of a major trend reversal today with at least 20 bars and 2 legs up. The market had a lower low major trend reversal on the first bar and became always in long. After a reasonably strong 5 bar rally, it then entered a triangle, but remained always in long. The follow-through on bars 2, 6, and 6 was weak and a trading range was likely.
Bull want a 2nd leg up, but the bears want a bear breakout below the triangle and then a measured move down to the low of the day. Bulls will buy any selloff that reverses up, even if the market falls to a new low of the day, because they know that the odds favor a 2nd leg up.
Updated 7:50 am
Since this is a triangle, there is a 50-50 chance of a successful breakout up or down, and a 50-50 chance of a failed breakout, reversal, and measured move. If the bears reverse the market down, there will probably be buyers around the low of the day since the rally to bar 5 was strong.
Traders can see the end of the day bar-by-bar report by signing up for free at BrooksPriceAction.com. I talk about the detailed Emini price action real-time throughout the day in the BrooksPriceAction.com trading room, and a 2 day free trial is available.
I sometimes refer to bar numbers (there are 81 five minute bars each day) instead of times on the 5 minute. When I mention time, it is USA Pacific Standard time (the market opens at 6:30 am PST, and closes at 1:15 pm PST). Background information on this report can be read on the Intraday Market Update page.
