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Emini in trading range around February high

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Emini and Forex Trading Update:
Wednesday March 24, 2021

Pre-Open market analysis of daily chart

  • Yesterday was a bear day but it had a prominent tail below. The Emini traded below Monday’s low and 3,900 Big Round Number, but closed above both, and therefore was not as bearish as it could have been. Emini in trading range.
  • Yesterday closed at open of week, so this week so far is neutral (doji inside bar on weekly chart).
  • Bears hope selloff from all-time high is early Small Pullback Bear Trend, but need consecutive big bear days closing near their lows to put odds in their favor.
  • The bulls see past 5 days as pullback from last week’s all-time high. Need good buy signal bar for resumption up to 4,000 Big Round Number.
  • Middle of 2-week trading range. Slightly more likely to make a new high before end of month, because of end of quarter window dressing and strong early March rally.
  • Most days for several weeks have had at least one swing up and one swing down. Traders will expect that again today. But if there is a series of strong trend bars up or down in the 1st hour, traders will bet on a trend day.
  • Market is deciding if there will be end of the quarter window dressing, and a test of 4,000 before end of month. Bears want reversal down from higher high major trend reversal on daily chart, and from head and shoulders top on 60-minute chart.

Overnight Emini Globex trading on 5-minute chart

  • Emini up 7 points in Globex session.
  • Yesterday was sell climax for several hours, so probably will get at least a couple hours of sideways to up trading today, that starts by the end of the 2nd hour.
  • Bulls hope that today will reverse up from a double bottom with March 19 low. A double bottom reversal would be pullback from the March 19 rally.
  • Bears want strong break below March 19 low for 60-minute head and shoulders top.
  • Most days have had at least one swing in both directions, so traders expect that again today.
  • Since trading range for 2 weeks, Emini is in Breakout Mode. Traders are ready for strong trend in either direction, but typically need series of strong trend bars in 1st hour. Without that, then probably a lot of trading range trading, like most recent days.

Yesterday’s Emini setups

Emini in trading range with breakout below bottom of trading range and 3900 big round number

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 weak breakout at bottom of wedge bottom
  • EURUSD at bottom of bear channel that began January 6. Might reverse up.
  • Selloff from March 11 high has had many reversals, and many bars with tails. Looks more like bear leg in trading range that began March 9, than resumption of bear trend.
  • Weak selloff and at bottom of bear channel so increased chance of reversal up.
    Bears need consecutive bear bars closing below March 9, to get test of November 4 major low at 1.16 on weekly chart.
  • Bulls need strong bull signal bar.

Overnight EURUSD Forex trading on 5-minute chart

  • Broke below March 9 low, but immediately entered trading range.
  • Trading range is 30-pips tall, so bull day traders are buying reversals up for scalps. They want strong reversal up, and for today to close above open, so that today will be buy signal bar on daily chart.
  • Bears want today to close near low of day, and far below March 9 low to increase chance of continuation down to November 4 major low at 1.16. Bear day traders are selling rallies, but have only been scalping.
  • With bears and bulls both scalping, increased chance that today will remain trading range day. Unlikely to become big bull or bear trend day.

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

Emini buy climax and then bear channel

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

  • Wedge bull flag at EMA and 50% pullback.
  • Failed breakout above 18-bar range. 11-bar bull microchannel so minor reversal likely.
  • Double top lower high major trend reversal led to bear channel for rest of day.
    Bulls could not hold support at open of week and 3,900 Big Round Number.
  • 9-bar tight trading range on daily chart, but turning down from head and shoulders top on 60-minute chart. Bulls want breakout above 4,000 and rally into end of quarter, and bears want reversal down from higher high major trend reversal.
  • Since close near low, might gap down tomorrow. Bears want break below last week’s low, which would trigger a weekly sell signal for a small double top.

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 Time

When I mention time, it is USA Pacific Time (the Emini day session opens at 6:30 am PT, and closes at 1:15 pm PT). You can read background information on the intraday market reports on the Market Update page.

  • Not sure Al if you are still taking questions on this post. I was interested in why you would be confident to short under Bar 20, as you highlighted? I can see it as climatic and well above the moving average. Yet, bars 11-19 were strong. Appreciate your insight as I’ve pondering it the last few days.

  • Dear Al,
    In your blog review charts of the day you mention ofter “OO”. Can you explain what that means?
    Thanks in advance!!.

    • Hi Rene,
      OO means “outside-outside” so a pattern where consecutive outside bars occur after a prior bar.
      You will also see ioi often, which is “inside-outside-inside” pattern.

  • Dear Al,

    Was it too early to sell bar 57 ioii (in case of 56 a second leg of 52)? Should I wait for failed BO of this TTR before selling?

    If I sold 59, should I exit at outside up bar 64, WB and possible bull reversal in TR day? or should I wait for another bull FT bar to exit?

    Thank you.

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