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Emini 8 bull bars streak will probably end today

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Emini and Forex Trading Update:
Wednesday April 7, 2021

Pre-Open market analysis of daily chart

  • Emini 8 bull bars streak is unusual and therefore unsustainable and climactic.
  • Since yesterday closed in lower third, today or tomorrow will probably be a bear bar.
  • Also, today will probably trade below yesterday’s low.
  • Open of the day will be a magnet late in the day if the Emini is within 10 points of it.
  • 8 consecutive bull bars means aggressive bulls. They will buy below yesterday’s low and the first 1- to 3-day pullback.
  • Extreme buy climax, but no sign of major top. Similar to the parabolic rallies in June and October. Both were followed by 10% pullbacks. Traders will continue to buy until there is a strong reversal down.

Overnight Emini Globex trading on 5-minute chart

  • Yesterday’s high was a ledge top (5 bars in a tight trading range with identical highs).
  • Ledge top is a magnet. Emini should break above it within a few days.
  • Down 3 points in Globex market so will likely get gap down.
  • Small gaps usually close in 1st hour.
  • Bears want big bear day, which would increase chance that yesterday was start of 2-week selloff.
  • Today will probably close below the open, but bulls will likely buy 1st 1- to 3-day pullback.
  • After 2 big bull days, today will probably not be a big bull trend day.
  • While it is possible that today will be a big bear day, and reverse Monday’s rally, a trading range day with a close below the open is more likely.
  • Should have at least one swing up, and one swing down today.
  • If there is a series of strong trend bars in either direction in the 1st hour, then could get trend day.

Yesterday’s Emini setups

Emini bull trend from the open and then bear trend reversal from wedge top. Emini 8 bull bars streak will likely end today.

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. Buyers of both the Brooks Trading Course and Encyclopedia of Chart Patterns have access to a much more detailed explanation of the swing trades for each day (see Online Course/BTC Daily Setups).

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.

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 Forex 1st leg up from wedge sell climax bottom
  • Two big bull days closing near their highs so strong reversal up.
  • 1st reversal up from tight bear channel is typically minor, which means it is more likely to lead to trading range than to bull trend.
  • Reversal up from wedge bottom usually has at least 2 legs up, and often reaches last lower high.
  • Traders will buy 1st 2- to 3-day pullback, expecting 2nd leg sideways to up.
  • Since this is probably a bull leg in what will be a trading range, and trading ranges disappoint traders, rally should stall today or tomorrow.

Overnight EURUSD Forex trading on 5-minute chart

  • Reversed down from above yesterday’s high. Since 3rd consecutive big bear day is unlikely, today will probably be a trading range day.
  • Day traders have been selling rallies and buying selloffs, and have been taking quick profits.
  • Trading range day will probably continue.
  • If there is a series of big trend bars up or down, day traders will switch to swing trading, but trading range day is more likely.
  • Open of day will be magnet at end of day. Bulls want 3rd consecutive bull day, which would increase chance of higher prices tomorrow.
  • Bears want today to close on its low, which would increase the chance of a pullback tomorrow.

Summary of today’s S&P Emini futures price action and what to expect tomorrow

Emini trading range day closing on its high

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. Buyers of both the Brooks Trading Course and Encyclopedia of Chart Patterns have access to a much more detailed explanation of the swing trades for each day (see Online Course/BTC Daily Setups).

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.

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.

End of day summary

  • Weak rally on open.
  • Reversal down from wedge.
  • Late test below open.
  • Trading range day, but closed on its high.
  • 9th consecutive bull bar on daily chart so unsustainable and climactic.
  • No top yet, and traders will continue to bet on higher prices.
  • Bulls will buy the 1st reversal down.

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 Market Update page.

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