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Emini Sellers above December 20th Outside Down Bar

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Trading Update: Wednesday December 27, 2023

S&P Emini pre-open market analysis

Emini daily chart

Emini Daily: Far from Moving Average, Sideways Soon
  • The Emini rallied today, testing the high of the December 20th outside down bar. This is an area where there will probably be more sellers at this price level.  
  • The December 20th outside down bar is strong enough to increase the odds of a second leg down. However, the market is in a bull trend, which increased the odds of a deep pullback above the high of December 20th.
  • While December 20th is a strong bar for the bears, it is probably not the start of a bear trend. This means that the best the bears can likely expect is the beginning of a trading range.
  • The market is far from the moving average. This will increase the odds of a test of the moving average soon.
  • Traders are happy to buy above the moving average in a strong bull trend. Eventually, there will not be enough traders willing to buy above the fair price (moving average). This will cause the market to reach the moving average to find enough buyers.
  • There is a possible measuring gap from the November 13th high to the November 14th low, which projects up to the March 2022 high. This is a logical next target for the bulls. However, it may have to pull back first because the market is so overbought and far from the moving average.
  • Overall, traders should assume that the market will probably go sideways over the next several days. The best the bears will probably get is a selloff down to the moving average and more sideways trading.

Emini 5-minute chart and what to expect today

  • Emini is down 1 point in the overnight Globex session.
  • The overnight Globex market has gone mostly sideways in a range of less than 10 points.
  • The bulls recently formed an upside breakout around 8:00 AM EST. They are hopeful that the market will test up to yesterday’s high.
  • As always, traders should expect a trading range open. This means that traders should consider waiting for 6-12 bars before placing a trade. Unless they are willing to make quick decisions and trade with limit orders.
  • There is only a 20% chance of a trend from the open.
  • This is the year’s final week, and traders should be prepared for a small range. The final week of the year is a great time to practice discipline and ensure they are only taking takes with a mathematical edge.
  • Traders should focus on catching the opening swing that will probably form before the end of the second hour, after the formation of a double top/bottom or a wedge top/bottom.
  • Lastly, here is an Ask Al Brooks Clip that is excellent advice for trading in a trading range. I try to review these clips regularly as they are very helpful. I am adding this clip below as a reminder of the trading range price action that is likely to form going into the final days of the year.

Emini intraday market update

  • The Emini formed a trading range for the first 40 bars of the day.
  • The bulls formed an upside breakout during bars 43 and 44. The breakout is strong enough for a second leg. However, it is also testing yesterday’s high.
  • The risk the bulls face is that the bar 43 – 44 upside breakout is a second leg trap within a larger trading range.
  • The longer the market goes sideways here, the more bulls will exit, and bears will begin to sell.
  • The first target for the bears is the bar 35 breakouts point high. Next, target for the bears is the bar 41 breakout low.
  • Bar 55, the bears are winning, and the odds favor a test of the low of the day. The next target for the bears is a test of the 60-minute moving average.

Yesterday’s Emini setups

SP500 Emini 5-Min Chart Small Pullback Bull Trend From The Open

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

EURUSD Daily: Always In Long, Pullback Likely
  • The EURUSD is Always In Long. However, it will probably pull back soon.
  • The bulls formed a High 1 buy signal bar yesterday. However, sellers are probably above the bar for at least a scalp. The sellers may not come in until it reaches the December 25th high.
  • The rally that began back in December is starting to form more overlapping bars. This is a sign of trading range price action. This increases the odds of more overlapping bars soon.
  • The November selloff damaged the bulls and increased the odds of the daily chart going sideways for several bars soon.
  • If the market continues to stall and go sideways, more bulls will begin to take profits above the November 29th high.
  • Overall, traders should expect the bulls to become disappointed and for the EURUSD to begin to go sideways to down.

Summary of today’s S&P Emini price action

SP500 Emini 5-Min Chart Trading Range Expanding Triangle

Al created the SP500 Emini charts.

End of day video review

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.

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