Emini stuck at the 3,900 Big Round Number since early February

Emini and Forex Trading Update:
Thursday March 11, 2021

I will update again at the end of the day.

Pre-Open market analysis

The Emini formed a small bull doji bar yesterday on the daily chart. It tested the 3,900 Big Round Number, like most days since early February. It is also testing the February 24 lower high.

Even though the Emini rallied for 4 days, it has been in a trading range since early February and stuck at 3900 Big Round Number. Unless the bulls break strongly above the February 24 lower high, and the February 16 all-time high, it is still slightly more likely to drop 10% from a double top before breaking above 4,000. This is because of the streak of 3 consecutive strong bear days last week. However, one big bull day would flip the odds in favor of 4,000.

With yesterday being a small day at the 3,900 magnet, there is an increased chance of today having a lot of trading range price action as well. This is true even it it rallies 30 points to the all-time high.

But because the Emini has been testing an important price for a month, there is an increased chance of a big trend day in either direction. If there is a series of strong trend bars up or down in the 1st hour, the odds of a trend day will go up.

Today is rollover day in the Emini. June is now the front month. However, March will still have much greater volume through the end of the day. Therefore, most traders will trade March today and then June starting tomorrow.

Overnight Emini Globex trading

The Emini is up 22 points in the Globex session. It therefore might break above yesterday’s high. If it does and the gap is small, it will probably close in the 1st hour.

Today’s open will be important. If there is a series of strong trend bars in either direction, there would be an increased chance of a trend day. If the bulls get an early, strong trend, today could be a big bull day, and break to a new all-time high.

Can the bears get an equally strong big bear day? Probably not. This is because the 4-day rally has been in a tight bull channel on the 60-minute chart. It will likely have to go sideways for another day or so, before the bears have a reasonable chance of a strong reversal down.

What is most likely? The Emini is at the top of a 5-week trading range. Most days have had at least one swing up and one swing down. The Emini will probably have at least a couple swings again today. Also, it is likely to spend a lot of time going sideways, like most days for the past month. If there is a trend, it will more likely be a weaker trend, like a channel or a Trending Trading Range 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. 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

The EURUSD Forex market on the daily chart is reversing up from a sell climax at the bottom of a bear channel. Since there were 3 legs down, this is a wedge bottom reversal attempt.

All reversals up from sell climaxes begin with short covering. I said that the EURUSD should break above the February 5 low this week. It did overnight.

But how far up will it go? If the bears get a strong bear bar today, there might be one more push down before a 2-week rally. If not, the current rally will probably last a couple weeks and have a couple legs. It could test the March 3 lower high, which was the top of the most recent sell climax.

Tomorrow is Friday and this week is becoming a buy signal bar on the weekly chart. The more the week closes on the high, the more traders will expect higher prices next week. The week will probably not close back at the low, so the EURUSD will probably be sideways to up for at least another week.

Overnight EURUSD Forex trading

The 5-minute chart of the EURUSD Forex market rallied in the Asian session to above the February 5 breakout point. However, it has been in a tight trading range for the 6 hours since. Day traders have been buying and selling for 10-pip scalps.

Will the bears get a bear breakout and turn today into a Low 1 sell signal bar on the daily chart? Or, will the bulls either keep the day sideways or get a 2nd leg up? If the bulls win, tomorrow will probably be sideways to up as well.

So far, the EURUSD is paying a lot of attention to the February 5 low. It could continue sideways and then close a little above or below it.

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. 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

The Emini gapped up and rallied in a Bull Trend From The Open from a double bottom just above the EMA. The rally began as a 14-bar bull micro channel, and the it evolved onto a trading range after breaking to a new all-time high. There was a midday reversal down from an expanding triangle top just below the 3,950 Big Round Number, and today closed in the middle of the range and below the February 16 all-time high.

Today erased the bearishness of last week’s 3 consecutive bear days, but the failure to close at a new high disappointed the bulls. They are still hoping that there will be enough follow-through buying over the next few days to break above the 4,000 Big Round Number. Because of the weak close and a 6-day bull micro channel, there is an increased chance that tomorrow will trade below today’s low.

And what about the bears? They want the breakout to fail. A reversal down at this point would be from a higher high double top on the daily chart. But since the bears gave up today, there will probably be at least a small 2nd leg up after the 1st brief pullback.

Traders will start trading the June contract tomorrow.

See the weekly update for a discussion of the price action on the weekly chart and for what to expect going into next week.

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Trading Room

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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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