Trading Update: Thursday March 2, 2023
Emini pre-open market analysis
Emini daily chart
- The Emini formed another bear doji bar closing below yesterday’s low. This is good for the bears. However, a doji is a sign of trading range price action, and bears unlikely to get fourth bear close on daily chart.
- The bears want a downside breakout below the February 24th low and for the market to reach the January 20th low.
- The bears need to get a decent bear bar closing near its low soon, or else the bulls will begin to buy, expecting a couple of legs sideways to up.
- The channel down from February 14th is tight, which is good for the bears. However, it is getting near support on January 19th low.
- Legs in trading ranges are always trying to trick traders into selling too low in the range or buying too high in the range.
- The market is close enough to support that if the bulls get a reversal up today or tomorrow, bears may be quick to exit, expecting more trading range price action.
- The market is retesting the January 19th high, which was a bad buy signal bar (bear doji bar). Some bears sold the high of January 19th and got trapped on the next bar (January 20th).
- The market has memory, and when it tests a price level that reversed up sharply, such as the January 19th high (support), bears will hesitate to sell. This increases the risk of a reversal up today or tomorrow.
- Overall, while the bears are doing a good job with the past three days being bear bars, the odds favor a reversal up soon and a possible test of the February 10th high, even if it takes 2-4 weeks to get there. This means traders should expect the bears to become disappointed soon and expect a sideways market.
Emini 5-minute chart and what to expect today
- Emini is down 23 points in the overnight Globex session.
- The Emini sold off late in the overnight session, reversed up in the early morning hours, but sold off again.
- Traders should expect today to have a lot of trading range price action on the open. As I often say, most traders should wait for 6-12 bars before placing a trade.
- There is greater than an 80% chance of a swing trade beginning before the end of the second hour.
- A reasonable swing trade often happens after the formation of a double top/bottom or a wedge top/bottom. This means traders can wait for the formation of one of the patterns mentioned above and look for a credible stop-entry swing trade.
- With the daily chart having three consecutive bear bars, the odds are lower that today will be a fourth bear bar. This means the odds favor a close below the day’s open.
- Overall, traders expect today to have a lot of trading range price action and expect the market to have a bull close. This means that if the market is not far below the open of the day, especially in the final hours of the session, traders should be open to a reversal up above the open.
Emini intraday market update
- The Emini gapped down and rallied on the open for the first 18 bars of the day.
- Bar 18 formed a credible wedge top, so traders should expect two legs down.
- The selloff down to bar 27 (8:45 AM PT) formed a parabolic wedge bottom. However, the channel down is tight. This increases the odds that the first leg will go down in the wedge top (bar 18), and the market will get a second leg down.
- The target for the bears is the 11 low. This is the bottom of the channel and a possible bottom of the range.
- Overall, the day looks like a leg in a trading range. Therefore, traders should be ready for a test of the open of the day. Traders should expect a sideways market for the next several hours.
- With the rally up to bar 18 being tight, traders need to be aware of a possible test of the high of the day (8:05 AM PT).
Yesterday’s Emini setups
Al created the SP500 Emini charts.
EURUSD Forex market trading strategies
EURUSD Forex daily chart
- The EURUSD rallied and went outside up yesterday, closing the breakout point (gap) from several lows. This is a sign that the selloff down to the February 2023 low is probably a bear leg in a trading range.
- Yesterday is a big enough surprise bar to increase the odds of higher prices and a 2nd leg up.
- The bulls need follow-through today, or the market may go sideways.
- Since the market is in a trading range, traders should assume that today will have a bear close which would be bad follow-through for the bulls.
- Overall, the market will probably rally over the next few weeks and try to form a lower-high major trend reversal on the daily chart.
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.
Why did you stop Daily Setups? It was by far the best learning tool.
This is not really the place to discuss this topic as Daily Setups (detailed charts) do not appear on blog posts except as samples every 2-3 weeks. The charts above have not changed.
Go to the support forum where a discussion thread is ongoing. Daily Setups have been replaced by daily E charts.
Your forecast has been impeccable today, chapeau!