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Emini Bulls Second Leg Up to May 1st Wanted

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Trading Update: Monday May 8, 2023

S&P Emini pre-open market analysis

Emini daily chart

  • The Emini gapped up and rallied last Friday, forming a strong bull trend day.
  • The odds are there are buyers not far below and the bulls second leg up will be achieved.
  • The May 1st low is a magnet for the bulls. Some bulls bought the May 1st low and scaled in lower. They were disappointed by the three-bar selloff down to May 4th and will likely look to exit around the May 1st low.
  • The bulls want the rally up from May 4th to be a double bottom with the April 26th low. Next, they want the market to break above the neckline (May 1st) and rally for a measured move-up.
  • The bears see the market in a trading range. They do not mind a test of the May 1st low as long as any breakout of the May 1st low quickly fails and reverses back down.
  • Traders will pay close attention to what kind of follow-through the bulls can get today. If the bulls can get a second strong bull trend bar, the odds will increase for higher prices. However, there will likely be something disappointing about the follow-through today, reminding traders that the market is still in a trading range since April.

Emini 5-minute chart and what to expect today

  • Emini is up 4 points in the overnight Globex session.
  • The Emini has gone sideways for more of the overnight session.
  • The bulls want the market to rally today and get follow-through on the daily chart.
  • The bears want any upside breakout above yesterday’s high to fail and the market to reverse back down.
  • As I often say, most traders should assume that the market will have a lot of trading range price action during the first hour. This means most traders should wait for 6-12 bars before placing a trade unless they are comfortable with limit order trading.
  • Most traders should try and catch the opening swing, which will often begin before the end of the second hour. The open swing will often begin after the formation of a double top/bottom or a wedge top/bottom.
  • Traders should expect a trading range day and for the bulls to be disappointed; however, they should be open to anything. This means that if the market starts to form a trend from the open, traders cannot deny the possibility of the day becoming another bull trend day.

Emini intraday market update

  • The Emini has been going sideways for the first three hours of the day.
  • The market formed a triangle for the first 40 bars of the day and is deciding on which direction will get the breakout and measured move up or down.
  • When the market is in breakout mode, it is essential to be patient and wait for a successful breakout with follow-through. Triangles can last a long time, and it is easy to get trapped into betting on the breakout becoming successful, only to have the breakout fail and take a big loss.
  • Eventually, a breakout will happen, so it is important to be patient.
  • The market may test last Friday’s high and see what is above it. The bulls want follow-through after last Friday, and the bears want to prevent it.

Friday’s Emini setups

SP500 Emini 5-Min Buy The Close Bull Trend into Bear Channel Then Trend Resumption. Emini bulls second leg up wanted.

Richard created the SP500 Emini charts (Al on leave).

Here are several reasonable stop entry setups from Friday. I show each buy entry with a green rectangle and each sell entry with a red rectangle. 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: Trading Range Likely Soon
  • The EURUSD will likely form a trading range following the bull channel that began on March 23rd. This means that prior lower highs in the bull channel are magnets.
  • The bears must get a breakout below the moving average (blue line). Next, they need to get consecutive closes below the moving average.
  • Until the bears begin to close below the moving average, traders will assume that the bears will fail and that the market will continue to get sideways to up.
  • The bulls want an upside breakout. However, the bulls have failed to keep gaps open, which increases the odds of a trading range soon.

Summary of today’s S&P Emini price action

SP500 Emini 5-Min Trading Range Day Bear Surprise Breakout but Close near Open

Richard created the SP500 Emini charts (Al on leave).

End of day video review

Live stream video review with Brad Wolff. Here is YouTube link:

Emini End of Day Video Review for Monday May 8, 2023

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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