Trading Update: Monday October 28, 2024
S&P Emini market analysis
Emini daily chart
- The daily chart of the Emini is at the moving average and has gone sideways for the past 11 trading days. Probability is neutral for both bulls and bears.
- The bulls want the pullback to the moving average to lead to a bull flag and trend resumption up to the 6,000 big round number.
- The bears want a bear breakout below the bear flag and a measuring move down the 11-day tight trading range.
- Because the market is in a bull channel, which is a trend, the odds favor the bulls slightly.
- However, if the bulls had high probability, the market would not be going sideways for this many bars.
- This means the odds are not 60% that the market will increase. It is much closer to 50% for bulls and bears. The bulls may have a 4% advantage over the bears, but not by much.
- The 6,000 round number is an important magnet above, and the Emini will likely be unable to avoid it. However, as the selling pressure increases, the market may have to pull back before testing up to the 6,000-round number.
- The bears are hopeful that today will lead to a bear breakout below last Friday’s low, and the bulls want bad follow-through.
- Overall, the bears need a strong breakout below the moving average for traders to conclude that the market is Always In Short.
Emini 5-minute chart and what to expect today
- Sunday night opened with a gap up, and the market has gone sideways on the 15-minute chart ever since. This puts the market in breakout mode and probability close to 50% for both the bulls and the bears.
- The bulls have a recent upside breakout around 9:00 AM EST. However, it is inside of the 15-minute trading range. The Bulls may get a second leg up after the 9:00 AM upside breakout.
- Today, we will probably open a trading range, meaning traders should be patient.
- The market will gap up on the open, increasing the risk of a second leg up.
- There is usually an opening swing trade that begins sometime before the end of the second hour. The opening swing will often last for two legs and two hours, making a great swing trade.
- The bears are hopeful that the bear trend from the open will last all day; however, it looks more like a bear leg in a trading range. The bears need to do more.
- There is an 80% chance of a trading range opening and only a 20% chance of a trend from the open.
- Trading ranges always form a double top/bottom or a wedge top/bottom. This means a trader can wait for one of these patterns to form before placing a trade to catch the opening swing.
Emini Intra-Day Update
- The U.S. Session has gone sideways for the first two hours of the session in a tight trading range.
- The market is now in breakout mode, meaning the probability for a breakout up or down is 50%.
- The bulls tried to find buyers at the moving average on bar 19; however, this led to sellers above bar 21 for a second leg down.
- Bar 23 closed under the moving average, which is a warning that the bulls are losing control.
- Last Friday’s bar 64 is a breakout point that may have to get tested.
- The gap up on the open is more likely to convert the market into a trading range and not a bull trend.
- Trading ranges close breakout points, which means the risk of last Friday’s bar 64 breakout point closing is real.
- The bears are hopeful that they will be able to get a measured move down of the tow-hour tight trading range, which, as of bar 24, looks like they may get it.
Friday’s Emini setups
Al created the SP500 Emini charts.
Summary of today’s S&P Emini price action
Al created the SP500 Emini charts.
Emini end of day video review
End of Day Emini Review will begin at 4:15 PM EST. Click the link to join: https://www.youtube.com/live/t7MzOdbE6CE?si=U8nBZ1-wTSXrF71H
EURUSD Forex market analysis
EURUSD Forex daily chart
- The EURUSD formed a strong bear reversal bar, closing on its low, but the context was bad for the bears.
- Today, buyers were found below last Friday’s low, and the market reversed.
- The bulls are trying to form a bottom with the August low and get a rally up to the moving average.
- The selloff down to the October low was in a tight bear channel. This increases the risk of sellers above the moving average.
- The problem the bears have is that the daily chart is in a large trading range. This increases the risk of the bears getting trapped and the market getting a reversal up to the September 11th breakout point low.
- The Bulls want a breakout above last Friday’s high to lead to a measuring gap that would project up to the October 11th doji bar, a bad sell signal bar for the Bears.
- Always In Bears likely got out of shorts above last Thursday (October 24th). They held for several bars down and would be hesitant to sell again below Friday’s low, which is at the August 1st Support.
- Although the bears may step aside for a couple of legs, this is not a great area for bulls to buy. The channel down is still tight, lowering the bulls’ probability. This is because any reversal up is likely to be minor.
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.