Emini and Forex Trading Update:
Thursday June 27, 2019
I will update again at the end of the day.
Pre-Open market analysis
The Emini yesterday broke above Tuesday’s bear channel, which was likely. It then sold off in a bear channel and closed on its low.
It was the 4th consecutive bear day in a reversal down from above the September/May double top. The 20 day EMA and the tight trading range just below 2900 are magnets below. Since the momentum down is strong, the Emini should get there within a week. However, this selloff is still more likely a pullback in a bull trend than the start of a bear trend.
Overnight Emini Globex trading
The Emini is up 5 points in the Globex session. Consequently, there is a 75% chance of a bull breakout above a bear channel and then at least a couple hours of sideways to up trading. I said that yesterday after Tuesday’s bear channel. Yesterday broke above the bear trend line and entered a triangle for 3 hours. However, the bears then got trend resumption down.
The odds of today selling off all day again are less. This is true even though the Emini is close to the 20 day EMA, which is a magnet below. It is because the Emini has had 4 consecutive bear bars on the daily chart. Traders believe that this selloff is a pullback from the new all-time high and not the start of a bear trend. Pullbacks typically only last a few days before bouncing. Therefore today will probably have at least one stronger rally. Furthermore, the Emini will likely close above the open and not form a 5th consecutive bear day.
Yesterday’s setups
Here are several reasonable stop entry setups from yesterday. I show each buy entry with a green rectangle and each sell entry with a red rectangle. I rarely also show limit order entries and entries on the close of bars. Buyers of the Brooks Trading Course have access to a much more detailed explanation of the swing trades for each day.
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.
EURUSD Forex market trading strategies
The EURUSD daily Forex chart formed an inside day yesterday and today so far is a 2nd consecutive inside day. That is an ii (inside-inside) Breakout Mode pattern, which means it is both a buy and a sell setup.
The bears see it and yesterday as a sell setup for a failed breakout above the April/June double top. They also see a wedge rally with the May 27 and June 12 highs as the 1st 2 legs up. Finally, they think the rally is forming a lower high double top with the March high.
Most traders, however, believe that this rally will go above the March high and possibly the January high. They know that a bear break below yesterday’s low will probably simply be a test of the 1.13 neck line of the head and shoulders bottom.
But they also know that the bears still have a 40% chance of being right. The probability for the bears will go up if they get a micro double top with a strong bear reversal bar or a huge bear Surprise Bar within the next week.
Overnight EURUSD Forex trading
The EURUSD 5 minute Forex chart has been in a 30 pip range overnight. Furthermore, its low did not go below yesterday’s low and its high is below yesterday’s high. Today therefore so far is an inside day.
The range over the past 5 hours has been only 15 pips. That is too small even for scalpers to make money. However, day traders will continue to scalp, expecting the range to expand at least a little.
Today is the 4th day in a tight trading range. That makes more trading range price action likely again today.
Summary of today’s S&P Emini futures price action and what to expect tomorrow
Here are several reasonable stop entry setups for today. I show each buy entry with a green rectangle and each sell entry with a red rectangle. I rarely also show limit order entries and entries on the close of bars. Buyers of the Brooks Trading Course have access to a much more detailed explanation of the swing trades for each day.
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.
End of day summary
After an early trading range, the bears got a downside breakout. But unlike the past 2 days, the bear breakout failed and the Emini reversed up. The trend was not strong, but the bulls finally got a bull bar on the daily chart.
After 4 bear days on the daily chart, this 1st reversal attempt will probably only last a day or two. However, this weekend’s China trade talks can be an important catalyst for a big move up or down next week.
Tomorrow is Friday so weekly support and resistance can be important. The bulls would like to get back up to the open of the week. That would turn the week into a doji bar instead of a bear inside bar.
The bears want the week to close on its low. It would then be a sell signal bar for next week. However, after a strong 3 week rally, it would be a minor sell setup.
Tomorrow is also the last day of the month. There are no nearby significant monthly targets. June already will be an oo (consecutive outside bars) buy signal bar for July.
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
Traders can see the end of the day bar-by-bar price action report by signing up for free at BrooksPriceAction.com. I talk about the detailed S&P Emini futures price action real-time throughout the day in the BrooksPriceAction.com trading room. We offer a 2 day free trial.
Charts use Pacific Standard Time
When I mention time, it is USA Pacific Standard Time (the Emini day session opens at 6:30 am PST, and closes at 1:15 pm PST). You can read background information on the intraday market reports on the Intraday Market Update page.
Hi Al, what about bar 39 short for wedge top 21-33-39? my concern was that 31-36 was a strong leg up and another leg up was likely but i took the trade anyway and got stopped out on bar 47.