Brooks Trading Course

Learn to Trade Price Action Consistently

 

More results...

Emini Bull Microchannel Likely to End Today

By

Trading Update: Monday August 19, 2024

S&P Emini market analysis

Emini daily chart

  • The Emini has formed a 10 consecutive bull micro channel on the daily chart. While this is a sign of strong buying by the bulls, it is also a sign of climactic behavior.
  • The odds are against the daily chart getting 11 bars in the microchannel.
  • If the bulls get another bar added to the bull micro channel, the odds of a 12th bar in the bull micro channel will be even lower.
  • This means there is an increased risk that today will fall below yesterday’s low.
  • The daily chart is in an overall trading range at the 5,600-round number. This is an important magnet that is in the upper 1/3rd of the overall trading range. This price level is important because the upper 1/3rd of a trading range is a sell zone. This increases the risk of profit-taking by the bulls and bears beginning to establish shorts.
  • The rally up from the August 5th low is strong, and the odds favor a 2nd leg up. However, because the market is in a trading range, which increases the odds of a deep pullback before the bulls get a second leg up.

Emini 5-minute chart and what to expect today

  • Emini formed a small gap up.
  • The Emini went sideways for the first 9 bars of the day.
  • The ears formed a reversal bar on bar 9, a possible 2nd failed breakout above yesterday’s high.
  • The bears formed a strong entry bar with bar 10. However, the bar was a large bear breakout bar in the bottom of the trading range that began around bar 36 last Friday.
  • The bulls formed a strong reversal bar with bar 11. They are hopeful that it is the start of a reversal up and a successful breakout above the 8 high. While this is possible, a trading range is more likely than a strong bull trend, and the market will probably test back down to the 10 close sometime today.

Friday’s Emini setups

SP500 Emini 5-Min Chart Higher Low DB Then Trending Trading Range Day

Al created the SP500 Emini charts.

Here are reasonable stop entry setups from Friday. 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.

Summary of today’s S&P Emini price action

SP500 Emini 5-Min Chart Bear Trap and Then Small PB Bull Trend

Al created the SP500 Emini charts.

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.

    • >