Brooks Trading Course

Learn to Trade Price Action Consistently

 

More results...

Emini Profit Taking Likely for Day or Two

By

Trading Update: Monday April 3, 2023

S&P Emini pre-open market analysis

Emini daily chart

  • Emini profit taking likely with Emini having a strong rally into the month close last Friday.
  • The Emini is Aways In Long and likely going higher. However, Friday was a climactic bar which will increase the odds of Emini profit taking and going sideways for a day or two.
  • There is a bear trendline (blue line) just above, and the market will probably have to reach it in the next couple of days.
  • The market formed a bear flag with the March 13th low and March 22nd high. The bulls want a measured move of the flag, which projects up to around 4,300.
  • Some bears will see the August 16th high as the major lower high in the bear trend on the daily chart. The December 2022 high and the February 2023 high failed to lead to a new low (below October 2022), so some bears will see them as minor Lower Highs in a bear channel.
  • This means that the bears may try to form a wedge top with the December 2022 high and the February 2nd high.
  • The risk the bears face here is that the bulls have a possible double bottom (December 2022 low and March 13th low). Next, the bulls will want an upside breakout of the neckline (February 2nd high) and a measured move up, which projects to 4,600.
  • Overall, traders should expect Emini profit taking likely today, which means the market will probably have a lot of trading range price action today. This means today will probably not close as another big bull trend bar.

Emini 5-minute chart and what to expect today

  • Emini is down 6 points in the overnight Globex session.
  • Since last Friday was a strong climactic rally, there is a 75% chance of sideways last two hours beginning before the end of the second hour. There is a 50% chance of follow-through buying on the open and the market going sideways for two hours. Low probability of another bull trend day lasting all day.
  • Traders should expect the market to have a lot of trading range price action today. This means that traders should be patient and assume most breakouts will fail.
  • As I often say, most traders should wait for 6-12 bars before placing a trade unless they are comfortable with limit order trading.
  • There is greater than an 80% chance of a swing trade on the open beginning before the end of the second hour. The swing trade often forms a credible stop entry after forming a double top/bottom or a wedge top/bottom. This means a trader can wait for one of the patterns mentioned above to form before placing a trade and have a reasonable chance at catching a swing trading lasting at least ten bars and two legs.
  • Overall, traders should expect a lot of trading range trading today as the bulls take partial profits after last Friday’s climactic breakout.

Emini intraday market update

  • The Emini Rallied and formed a wedge top around bar 12. The bulls wanted a small pullback bull trend. However, that was unlikely after last Friday’s strong bull trend.
  • The bears got a strong bear breakout down to bar 21 (8:15 AM PT).
  • While the bears will probably get a 2nd leg down, the market will likely remain in a trading range for most of the day. This means traders should expect a possible deep pullback before the bears get a 2nd leg down.
  • As of 9:05 AM PT, the bulls are trying to get an endless pullback and reverse the damage caused by the bears. However, the upside will probably be limited.

Friday’s Emini setups

SP500 Emini 5-Min Bull Trend from Open Small PB Bull Trend. Emini profit taking likely.

Al created the SP500 Emini charts.

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 DT LH MTR
  • The EURUSD sold off on Friday and tried to form a double top lower high major trend reversal on March 23rd. However, the channel up from the March low is tight, lowering the probability that the major trend reversal is successful.
  • It is important to remember that most major trend reversals are really minor reversals that lead to more sideways trading.
  • The bulls want the market to reach the February 1st close, and the market will probably have to get there soon.
  • Overall, traders will pay close attention to see how this bar forms. If today is a bull bar closing on its high, that will increase the number of traders willing to buy above the bar.  
  • The bears want today to form a weak reversal bar, and they will try their best to keep the market from going above last Friday’s buy signal bar.

Summary of today’s S&P Emini futures price action

SP500 Emini 5-Min Yesterday Buy Climax Expect 2hr Sideways to Down

Al created the SP500 Emini charts.

End of day video review — Al Brooks

Al Brooks’ End of Day Review video up to 9am PT.

Video duration 22:57

 

End of day video review — Brad Wolff

Brad hosted a live stream End of Day Review at 1:00pm PT and answered questions.

Video duration 65:38

 

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.

    • >