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Emini Becoming Neutral on Daily Chart

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Trading Update: Tuesday December 17, 2024

Emini end of day video review

Emini EOD Review Joseph Imbornone

Follow Joseph’s YouTube channel for more Al Brooks price action analysis.

S&P Emini market analysis

Emini daily chart

  • The Emini is in a tight trading range on the daily chart and, therefore, a neutral market. Traders should assume that the probability is close to 50% of a directional breakout up or down.
  • The probability slightly favors the bulls because the market is in a bull channel, holding above the moving average.
  • The longer the market goes sideways and builds in selling pressure, the greater the risk of a downside breakout below the moving average and a test of the November 15th most recent major higher low.
  • While the bears have done a good job of making the market go sideways, they need to do more. Ideally, the bears need a series of bear bars closing below the moving average for traders to conclude the market is Always In Short.

Emini 5-minute chart and what to expect today

  • The Emini gapped down on the open and formed a bull reversal bar on bar 3.
  • While the gap down is good for the bears, the context is not ideal. The Gap down is near the bottom 1/3rd of the trading range on the daily chart, and the 15-minute Globex chart finds support around the day open.
  • The bulls hope that the bull trend from the open will last all day. They need more follow-through buying to reassure traders that the rally will last several hours.
  • Bar 5 is a strong enough rally that the odds favor a 2nd leg up and buyers below. 
  • At the moment, the market is buy the close for a second leg up.
  • Because of the buying pressure on the open, today will likely be a bull trend or a trading range day, not a bear trend day. 
  • The bull should not have allowed bar 6 to form. This is a disappointment, following the overlap on bars 5-6. This increases the odds of a trading range open.
  • Because of the big up and big down on the open, there is an increased risk of a trading range.
  • The bears are hopeful that the selloff to bar 9 is strong enough to trap the bulls and lead to a 2nd leg down.
  • Bar 9 is not an ideal sell because of the opening rally. There is too much risk of a trading range, and buyers are below bar 1 low. 
  • Bar 12, the bears are still short, and the bulls have no credible buy signal bar. Without one, bears will continue to sell, betting that the bulls will fail. The bears need to stop selling if they are going to get a reversal up and the formation of a trading range.

Yesterday’s Emini setups

SP500 Emini 5-Min Chart LL DB Then Breakout and Channel Bull Trend

Al created the SP500 Emini charts.

Here are reasonable stop entry setups from yesterday. I show each buy entry bar with a green arrow and each sell entry bar with a red arrow. Buyers of both the Brooks Trading Course and Encyclopedia of Chart Patterns have access to a near 4-year library of more detailed explanations of swing trade setups (see Online Course/BTC Daily Setups). Encyclopedia members get current daily charts added to Encyclopedia.

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. These therefore are swing entries.

It is important to understand that most swing setups do not lead to swing trades. As soon as traders are disappointed, many exit. Those who exit prefer to get out with a small profit (scalp), but often have to exit with a small loss.

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.

Summary of today’s S&P Emini price action

SP500 Emini 5-Min Chart LL DB Then Wedge Top

Al created the SP500 Emini charts.

EURUSD Forex market analysis

EURUSD Forex daily chart

  • The EURUSD is forming a tight trading range on the daily chart. This makes the probability very close to 50% for a breakout up or down.
  • Price is below the moving average. This slightly increases the odds for the bears, but not by much. If the probability were 60% or more for the bulls or bears, the market would not be going sideways inside of a tight trading range.
  • The bulls have done a good job of making the market go sideways. Next, the need to get a series of bull closes above the moving average, to convince traders that the market is now Always In Long.
  • Overall, the market is in breakout mode and is deciding on the direction of the breakout.

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

Al Brooks and other presenters talk about the detailed Emini price action real-time each day in the BrooksPriceAction.com trading room days. We offer a 2 day free trial.

Charts use Pacific Time

When times are mentioned, it is USA Pacific Time. The Emini day session charts begin at 6:30 am PT and end at 1:15 pm PT which is 15 minutes after the NYSE closes. You can read background information on the market reports on the Market Update page.

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