Emini and Forex Trading Update:
Friday June 21, 2019
I will update again at the end of the day.
Pre-Open market analysis
Yesterday opened at a new all-time high, but then sold off and closed its big gap up. It then reversed back up and closed at a new all-time high.
There are now consecutive outside bars on the monthly chart. June will therefore be a buy signal bar for July.
On the daily chart, the bears want the breakout to fail. Since the bull trend over the past month has been strong, the bears will need at least a micro double top to attract sellers. Consequently, there probably will be buyers below yesterday’s low.
Since yesterday was a doji bar on the daily chart, there is hesitation at major resistance. This increases the chance of 2 – 3 sideways days.
Today is Friday. The only nearby weekly support or resistance is the May all-time high. The bulls want the week to close above the September/May double top. That would increase the chance of higher prices next week.
Overnight Emini Globex trading
The Emini is down 5 points in the Globex session. Since yesterday ended with a 4 hour buy climax, the bulls will probably be exhausted. Therefore, there is a 75% chance of at least a couple hours of sideways to down trading that begins by the end of the 2nd hour. Also, there is only a 25% chance of a strong bull trend day today. However, the bulls have a 50% chance of follow-through buying in the 1st 2 hours.
While yesterday reversed up strongly, the selloff was strong enough to close a big gap up. Most reversal days are simply trading range days. The bears owned the 1st half and the bulls controlled the 2nd half. That early strength by the bears means they are will to sell aggressively around this price. It increases the chance of trading range price action for the next day or two.
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 is reversing up from a head and shoulders bottom. Yesterday was a big bull trend day. However, it had a prominent tail on top. In addition, the rally is still below the June high.
Two weeks ago, I mentioned that the weekly chart had its 1st close above the 20 week EMA in 9 months and a break above the yearlong bear trend line. This bottom on the daily chart further increases the chance that the bear trend is ending.
A bear trend ends once there are breakouts above major lower highs. The January 10 high of 1.1570 is the most important. Once a bear trend ends, the market has evolved into a trading range. There is also a 40% chance that it has reversed into a bull trend.
Every reversal attempt over the past year has failed. However, this one is stronger. The bulls have a 50% chance of a break above the March high and a test of the January high.
Overnight EURUSD Forex trading
The EURUSD 5 minute Forex chart rallied strongly yesterday. After a brief rally in today’s European session, it pulled back and resumed up in a broad spike and channel bull trend. That typically evolves into a trading range. Consequently, the rally will probably not go much higher today.
The bulls have already accomplished their objective. They reversed last week’s selloff on the weekly chart. There is a small chance that today could rally to above last week’s high and form an outside up week on the weekly chart.
If they simply close the week within 20 pips of the week’s high, they will have a good buy signal bar on the weekly chart for next week. Therefore, day traders will look to buy 20 – 30 pip selloffs, expecting the week to close strong.
Since the 5 minute chart will probably enter a trading range, the bears will sell rallies for scalps. But, the odds of a strong bear trend are small.
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
Yesterday crashed down and reversed up. Today crashed up and reversed down. The Emini then entered a trading range, but the bears got trend resumption down at the end. The bulls tried all day to get far above the May high but failed. Because today closed on its low, it is a sell signal bar for Monday for a failed breakout to a new high.
The fight next week will be over the close of the monthly chart. June is outside up after May being outside down. June is therefore a buy signal bar on the monthly chart. If the month closes near its high, the odds of higher prices over the next couple months go up. Consequently, all the bulls have to do next week is keep the price around where it is. It is already good for them.
The bears want a selloff next week. This would put a tail on the top of June on the monthly chart. That would lower the probability of much higher prices in July and August. However, the June rally was strong, as was the January to April rally. The odds favor sideways to up next week and then higher in July and August.
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.
Al–
I have not been to the site for a while. I am curious about a statement underneath the emini 5 minutes charts: ” Buyers of the Brooks Trading Course have access to a much more detailed explanation of the swing trades for each day.”
where do I find this other explanation? I purchased the first course; perhaps this doesn’t qualify and I can understand that. Thanks and all the best.
Hi James,
The “Swing Trade Setups for Day Traders” presentation is available until month end for all buyers of the “Brooks Trading Course”, or “Brooks Forex Trading Course”. You can access this new product under the “Online Course” menu. From next month (July 2019), this new presentation will be available to members who buy the “Brooks Price Action Setups Quick Reference” product that Al uses in his trading room.
The “Swing Trades…” product was created as a trial by Al. Given the strong demand, and as it developed over the last few weeks, Al added highlighted text linking to the “Brooks Price Action Setups Quick Reference” presentations that members can buy into as an extra. See under the “Learn to Trade” menu for samplers for both of these new products.
So, please review the “Swing Trade Setups…” and see if it helps. The sampler for this will be updated each month end to give a good sample of earlier charts.
I have given the above info out via the mailing list and will add a reminder again before month end. I will also modify the daily report setups chart caption to reflect this too.
Hope that helps.