Trading Update: Thursday September 14, 2023
S&P Emini pre-open market analysis
Emini daily chart
- The Emini reversed up after falling below Monday’s Low 1 short. The bulls will see yesterday as a buy signal bar for a second entry buy. However, the signal bar is a weak doji, which will lower the probability of buying above it.
- The bulls want today to become a strong entry bar and force bears to exit above it.
- The bears are hopeful that there will be sellers above Wednesday’s buy signal bar, which would create a second entry sell setup. They want the bulls buying above yesterday’s second entry buy to get trapped.
- Next, the bears want a second leg down and a test below the September 7th low.
- Overall, traders will pay close attention to see what kind of follow-through buying the bulls can get. If the follow-through is weak, the higher the probability the bears will form a second entry short in the next day or two.
Emini 5-minute chart and what to expect today
- The Globex market rallied above yesterday’s high and is testing near the September high. The Bulls hope they will get a strong rally today for the reasons mentioned regarding the daily chart.
- Traders should assume that today will have a lot of trading range price action, especially during the first 6-12 bars. This means that traders should use caution during the first hour of trading and consider not trading unless they are comfortable with limit orders.
- Traders should pay attention to yesterday’s high since it will likely be an important magnet today.
- There is an 80% chance of a swing trading developing before the end of the second hour. It is common for the swing trade to begin after the formation of a double top/bottom or a wedge top/bottom.
- Traders should try and catch the opening swing because there is at least a 40% chance the swing will double the opening range.
- Traders should remember that even with the possibility of a bull trend from the open, traders should remember that the odds still favor a trading range, not a bull trend.
Emini intraday market update
- The open formed a wedge bottom that reversed at the moving average.
- The bulls formed a strong bull microchannel, a breakout on a higher time frame.
- Next, the bulls are hopeful that the market will remain a bull trend for the rest of the day, which would create strong follow-through buying on the daily chart.
- More likely, the day will not close on its high.
- As of bar 46, the market is in a tight bull channel. The best the best can expect is a trading range until they can start getting strong closes below the moving average.
Yesterday’s Emini setups
Al created the SP500 Emini charts.
EURUSD Forex market trading strategies
EURUSD Forex daily chart
- The EURUSD is continuing to go sideways near the May 31st low.
- The bears see the tight trading range as a bear flag that will lead to a test of the May 31st low.
- The bulls want a bull breakout of the tight trading range and a test of the moving average.
- In general, tight trading ranges are low-probability environments for stop entries. This means the probability of a breakout up or down is nearly 50%.
- The market is in between the middle of two important magnets, the May 31st low and the moving average. The most important thing to realize here is that the market is neutral, and it is better to wait for a breakout up or down of the tight trading range.
- Even if the bulls get an upside breakout of the range, traders might be suspicious of the breakout. The daily chart has been in a tight trading range for some time, and the May 31st low is an obvious magnet. This means that the odds favor price falling below it and reversing up.
- If the market falls below the May 31st low, bulls will see the tight trading range over the past couple of days as a final flag.
Summary of today’s S&P Emini price action
Al created the SP500 Emini charts.
End of day video review
Here is YouTube link if video popup blocked:
See the weekly update for a discussion of the price action on the weekly chart and for what to expect going into next week.
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.