Market Overview: S&P 500 E-mini Futures
The market formed a strong weekly E-mini reversal breaking into new all-time high territory. Bulls want a spike and channel pattern lasting many weeks. Bears hope the breakout above the prior all-time high (January 28) will lack follow-through and form a failed breakout.
S&P500 E-mini futures
The Weekly S&P 500 E-mini chart
- This week’s candlestick was a large bull bar closing near its high in new all-time high territory.
- Last week, we said traders would watch the strength of the retest of the prior high—strong (consecutive bull bars closing near their highs) or weak (overlapping bars, prominent upper tails, and bear bars).
- Bulls generated an extremely strong rally over the past 3 weeks, forming consecutive bull bars closing near their highs.
- Bulls want a strong breakout followed by a measured move based on the height of the recent trading range, projecting to around 7550.
- If the market pulls back, bulls want it to be weak, forming a High 1 and a breakout pullback buy setup.
- If the market trades lower, bulls want the 20-week EMA to act as support.
- They expect at least a small sideways-to-up leg to retest the current leg high (April 17).
- Bulls want a spike and channel pattern lasting many weeks.
- Bears see the current move as a buy vacuum retest of the prior high.
- They hope the breakout above the prior all-time high (January 28) will lack follow-through and form a failed breakout.
- Bears need to create strong bear bars to show control.
- The market rallied strongly over the past 3 weeks.
- The market has likely flipped into Always In Long.
- The move up is strong enough for traders to expect at least a small sideways-to-up leg after any pullback.
- The market remains in a sideways-to-up phase and could trade slightly higher in the next few weeks.
- Odds slightly favor at least a small second leg sideways to up after a pullback.
The Daily S&P 500 E-mini chart
- The market formed a spike up this week, breaking into new all-time high territory.
- Last week, we said traders would watch the strength of the move—whether it forms a tight bull channel or shows deep pullbacks and strong bear bars. If strong, the odds of retesting the all-time high increase.
- Bears see the current move as a retest of the prior high and want it to form a higher high major trend reversal.
- Bears hope the move will lack follow-through buying and want a failed breakout.
- They see the rally over the past few weeks as climactic and overbought and expect at least a small two-legged sideways-to-down pullback.
- Bears need consecutive strong bear bars to show control.
- Bulls generated a strong retest of the all-time high, followed by a breakout above.
- The move up this week is a strong spike with no overlapping candlesticks, indicating strong buying pressure.
- Bulls want a measured move based on the height of the trading range, projecting to around 7550.
- Bulls need sustained follow-through buying to increase the odds of trend resumption.
- If there is a pullback, bulls want a second leg sideways to up, transitioning into a spike and channel bull trend.
- Bulls want any pullback to be sideways and brief, forming overlapping candlesticks and prominent lower tails.
- The move this week formed gaps and micro gaps, indicating urgency and strength.
- The market has likely flipped into Always In Long.
- The move up covered many points in a short time and is slightly climactic, increasing the odds of a small two-legged sideways-to-down pullback.
- Odds favor a second leg sideways to up following any pullback.
- For now, the market remains in a sideways-to-up phase.
Trading room
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