Market Overview: S&P 500 E-mini Futures
The E-mini bulls want a retest of the all-time high followed by a trend resumption. Bears want the retest of the trend extreme high to be weak, forming a lower high major trend reversal or a small double top.
S&P500 E-mini futures
The Weekly S&P 500 E-mini chart
- This week formed a bear doji closing above the middle of its range with a long tail below.
- Last week, we said traders would watch whether bulls could trigger the High 1 buy entry with sustained follow-through buying to retest the all-time high, or whether bears could create a second leg sideways to down.
- The market traded above last week’s high, triggering the High 1 buy entry. The long tail below indicates a weak attempt by bears to reverse the move.
- Previously, bulls generated a strong rally in a spike and bull channel from the March 30 low.
- Bulls want a measured move to around 8000, based on the height of the initial spike (from the March 30 low to the April 17 high).
- Bulls see the recent move (June 12) as a pullback and want a retest of the all-time high.
- They hope the pullback has alleviated the recent overbought conditions.
- Bulls want the pullback to be weak and sideways, lacking follow-through selling, with overlapping candlesticks and prominent lower tails.
- Bulls need to create sustained follow-through buying to increase the odds of a breakout and trend resumption.
- If the market trades lower, bulls want the June 12 low to act as support, forming a double bottom bull flag.
- Bears view the recent move (June 1) as an unsustainable buy climax.
- Bears want a reversal from a trend channel line overshoot, followed by a test of the April 23 low, which marked the start of the bull channel, or a test of the bull trend line.
- Bears hope for a two-legged sideways-to-down pullback lasting several weeks.
- Bears want the retest of the trend extreme high to be weak, forming a lower high major trend reversal or a small double top.
- Bears need to create consecutive strong bear bars to indicate strength. Without that, traders will be reluctant to sell aggressively.
- Previously, the market rallied in a strong spike-and-channel bull trend, breaking above the trend channel line.
- Failed breakouts above a trend channel line can lead to a test of the bull trend line.
- However, if the pullback is mostly sideways, with overlapping candlesticks and prominent lower tails, it can indicate strong bulls and increase the odds of trend continuation after the pullback.
- The long tails below the last two candlesticks suggest that bears are not yet decisively strong.
- Traders will watch whether bulls can generate sustained follow-through buying to retest the all-time high and resume the trend.
- Or whether the market forms a weak retest of the all-time high, followed by a second leg sideways to down in the weeks ahead, even if it first makes a new all-time high.
- For now, the current pullback is likely to remain minor.
The Daily S&P 500 E-mini chart
- The market gapped up on Monday, closing as a small bull bar. It then pulled back to the 20-day EMA, followed by an inside doji on Thursday.
- Last week, we said traders would watch whether bears could create a larger second leg sideways to down to retest the June 9 low or the April 23 low, or whether the pullback would remain weak, increasing the odds of a retest of the all-time high within the next few weeks.
- Bears view the recent rally (June 1) as overextended and climactic.
- Bears want a reversal from a wedge top (May 1, May 14, and June 1) and a higher high major trend reversal (June 1).
- Bears want a failed breakout above the trend channel line, followed by a pullback to test the April 23 low area or the bull trend line.
- Bears see this week as a retest of the prior high and want a reversal from a lower high major trend reversal.
- They want a second leg sideways to down to retest the June 9 low.
- Bears see the current move as a retest of the all-time high and want it to be weak, with overlapping candlesticks, bear bars, and prominent upper tails, forming a double top.
- Bears need consecutive strong bear bars to show decisive control.
- Previously, bulls generated a strong spike-and-channel bull trend.
- Bulls want a measured move to around 8000, based on the height of the initial spike (from the March 30 low to the April 17 high).
- Bulls view the recent move (June 9) as a pullback and want a retest and breakout above the all-time high.
- They hope the pullback has alleviated the recent overbought conditions.
- If the market trades lower, bulls want the June 9 low to act as support, forming a double bottom bull flag.
- Bulls want any pullback to be weak and sideways, with overlapping candlesticks, bull bars, and prominent lower tails.
- Bulls need consecutive strong bull bars to increase the odds of a retest of the all-time high and trend resumption.
- The recent pullback (June 9) broke below the bull channel, marking the first significant sign of selling pressure since the March 30 low.
- Traders will watch whether bears can create a second leg sideways to down to retest the June 9 low, even if it only forms a higher low.
- Or will the market trade higher and make a new all-time high within the next few weeks?
- Traders expect at least a small sideways-to-up leg to retest the all-time high after the pullback, whether it forms a lower high or resumes the trend.
- For now, the pullback may remain minor, even if it lasts a few weeks.
Trading room
Al Brooks and other presenters talk about the detailed E-mini price action real-time each day in the Brooks Trading Course trading room. We offer a 2 day free trial.
Market analysis reports archive
You can access all weekend reports on the Market Analysis page.
