Trading Update: Monday October 30, 2023
S&P Emini pre-open market analysis
Emini daily chart
- The Emini is becoming oversold, following the selloff down from the October high.
- The bears are likely becoming exhausted, which means the probability will probably pull back in the next couple of days and test 4,200.
- Exhausted bears do not mean a reversal into a bull trend. At a minimum, it means a brief pullback lasting 1-3 bars, but likely more.
- The bulls see the October 3rd low as a logical target, and they will begin to establish long betting that the market will bottom out soon and rally back to the October 3rd breakout point low.
- Overall, traders will begin to expect a pullback over the next couple of days, which means the bears who are selling closes will likely begin to be disappointed soon.
Emini 5-minute chart and what to expect today
- The overnight Globex market has been channeling up for several hours.
- The bulls want the open to gap up and for the daily chart to form a big bull trend bar, trapping bears on the daily chart.
- There is an 80% chance of a trading range open and only a 20% chance of a trend from the open lasting all day.
- Because there is an 80% chance of a trading range open, most traders are betting off waiting for at least 6-12 bars before placing a trade. By waiting allows a trader to understand the structure of the day better, and they can avoid getting trapped on the open.
- Most traders should focus on catching the opening swing that often begins before the end of the second hour. It is typical for the opening swing to start after the formation of a double top/bottom or a wedge top/bottom.
Emini intraday market update
- The Emini gapped up and rallied for the first five bars of the day.
- The market sold off in a tight bear channel down to bar 15. The bulls tried to get a reversal up. However, it led to a trading range.
- As of bar 45, the market has gone sideways for most of the day and is deciding on the direction of the breakout.
- The bears want a downside breakout and for the day to close on its low.
- The bulls want the upside breakout above bar 6 and for the day to close on its high.
- The market has not broken out of the 18-bar range, which means the odds favor a breakout of the day’s high or low.
Yesterday’s Emini setups
Al created the SP500 Emini charts.
EURUSD Forex market trading strategies
EURUSD Forex daily chart
- The EURUSD is going sideways after the October 24th two-bar reversal. The bears tried to follow follow-through. However, they failed, and now the market is in the middle of the October range.
- The bulls see the October trading range as a bear flag. They are hopeful that they will be able to get an upside breakout with follow-through. Next, the bulls would try for a measured move up of the October range.
- This means that traders wait and pay close attention to see what kind of follow-through the bulls will be able to get.
Summary of today’s S&P Emini price action
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.
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.