Trading Update: Monday May 12, 2025
Emini end of day video review
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S&P Emini market analysis
Emini daily chart
- The Emini formed a large gap up on the daily chart following trade tensions easing off between the U.S. and China.
- While this is the fundamental reason for the gap up on today’s open, the reality is the market’s been in a tight bull channel, and price wants to probe above the March 26th high.
- The rally up from the April 21st low has been in a bull channel, and the channel is getting climactic and far from the moving average. This is unsustainable behavior and increases the odds of a pullback soon.
- When the market begins to climb faster than the moving average. This is climactic behavior; therefore, the more behavior you see of this, the greater the odds of a pullback. It’d be different if the market were forming a small pullback bull rally, but this is not what we’re getting, and therefore, we may be forming some wedge.
- The bears need to get today to form a strong reversal bar that would convince bulls that this might create a wedge top and cause some bulls to look to exit. Without a credible sell signal bar, the odds are there’s probably buyers on any two-legged pullback back to the moving average.
- Overall, the Bears must follow through on selling if they get a credible downside breakout.
Emini 5-minute chart and what to expect today
- Today, a large gap formed, and bar one formed a bear reversal bar closing on its low. This was a strong enough reversal bar that the odds favored a second leg down, which the bears got on bars 12 and 13.
- Because the gap up was large, the odds favor a second leg up and buyers at or below the moving average.
- This increased the odds that traders will buy near the moving average on 13, which is what happened today.
- The Bulls are hopeful to rally up on 14 and 15, and strong enough to lead to a test of the bar one high and the day’s open.
- Right now, the bull micro channel up to the 17 high is strong enough for a second leg up. This increases the risk of the market getting up to the open of the day.
Friday’s Emini setups
Al created the SP500 Emini charts.
Here are reasonable stop entry setups from Friday. 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
Al created the SP500 Emini charts.
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 Brooks Price Action trading room. 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.
