Trading Update: Wednesday March 1, 2023
Emini pre-open market analysis
Emini daily chart
- The Emini formed a bear bar closing below Monday’s low. While this is good for the bears, yesterday’s bar is a doji bar which will lower the probability of lower prices. Bears maybe disappointed soon.
- The market is in a trading range, which means traders should expect the bears to become disappointed soon.
- The bears see the past two days as a pullback from the February 15th selloff. These bears expect a 2nd leg down.
- While the current selloff is more likely a bear leg in a trading range that is testing the January 20th low, the channel down is tight, which increases the risk of a downside breakout below February 24th and a test of the December 2022 low.
- The bulls want the market to form a double bottom and reverse up.
- Even if the market forms a double bottom with December 2022 low, the bulls do not mind if they can get a strong reversal up.
- The bulls got trapped buying the February 10th low during February 17th or 21st. Since the market is in a likely trading range, traders expect a rally that will close the gap (February 10th low) and allow the trapped bulls out.
- The market may have to test back into the December 2022 range first before the market can rally back up to the February 10th low.
- Overall, traders will pay close attention to today to see if the bears can get another bear bar closing on its low or will the bulls prevail and disappoint the bears by getting a bull close.
Emini 5-minute chart and what to expect today
- Emini is down 1 points in the overnight Globex session.
- The Globex market was in a bear channel for most of the overnight trading session.
- The bears got a strong bear breakout around 5:30 AM PT, making the market Always In Long.
- At the moment, the market will likely have a small gap down. This increases the odds of the open getting a small 2nd leg down.
- As always, traders should assume that the open will have a lot of trading range price action. This means most traders should wait for 6-12 bars before placing any trades unless they are comfortable with limit order trading.
- Most traders should focus on trying to catch the opening swing trade. The best way to do this is to wait for a double top/bottom or a wedge top/bottom. A credible swing trade will usually form before the end of the 2nd hour.
- Lastly, traders can wait for a breakout with follow-through and hold for a second leg in the direction of the breakout.
- As of bar 45 (10:10 AM PT) the selloff over the past three bars is strong enough to expect a 2nd leg down. The low of the day is likely in place.
- The bears will probably use the selloff to exit shorts. The bears were disappointed by the rally up to bar 29 (8:55 AM PT).
- Most bears will not want to sell too low in the range and will be cautious about selling much lower.
- The bulls will try and form a higher low major trend reversal around bar 45. They want a strong second leg up and breakout above the high of the day.
- With the channel down to bar 45 being tight; most traders will expect any rally to be minor.
Emini intraday market update
- The Emini has been going sideways for the first 40 bars of the day session.
- The market will likely remain a trading range day for the rest of the day.
- The selloff to 8:25 AM PT was big enough to limit the upside.
- The rally up to 9:00 AM PT is big enough to limit the downside.
- I am writing this as of bar 9:45 AM PT, and the market is forming a tight trading range. This will increase the odds that the market may have to get a deep pullback to around 50% of the rally from the low of the day to the high of 8:55 AM PT.
- Unless the bulls can get a strong upside breakout, traders should expect disappointment soon and a test down to around the 8:50 low.
Yesterday’s Emini setups
Al created the SP500 Emini charts.
EURUSD Forex market trading strategies
EURUSD Forex daily chart
- The market formed a L1 short yesterday. However, it is at the bottom of a likely trading range.
- A Low 1 short is generally a reasonable stop-entry trade in a strong breakout but not at the bottom of a trading range. This means that the odds favored buyers below yesterday’s low.
- The bulls have a small give-up bar today. They want the bar to close on its high and for tomorrow to be another follow-through bar.
- Overall, the market will probably have a couple of legs up, and the bears will try and form a lower-high major trend reversal. Traders should expect sideways to up over the next couple of days.
Summary of today’s S&P Emini futures price action and what to expect tomorrow
Al created the SP500 Emini charts.
End of day review
- Live stream video trial replacement of end of day review coming soon.
See the weekly update for a discussion of the price action on the weekly chart and for what to expect going into next week.
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.