Trading Update: Friday January 3, 2025
Emini end of day video review
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S&P Emini market analysis
Emini daily chart
- Yesterday, the Emini broke out below the December low. However, it failed to close near its low and formed a tail below the bar. This increases the odds of today’s formation of a bull bar and a reversal up.
- Even though yesterday was a disappointing bar for the bears, it is not yet a strong reversal bar. This means that the Bulls still have not done
- The bulls are hopeful that today, they will form a bull reversal bar, leading to a rally up to the high of December 26. Next, they want a break above the neckline and a rally above the December 6th high.
- Because of the trading range price action we have had over the past month, the odds favor the bulls getting disappointed by any rally.
- The bears want the opposite. They are hopeful that the selloff from the December 26th high will be strong enough to lead to a breakout below the range over the past two weeks and a measured move down of the December 18th bear breakout bar.
Emini 5-minute chart and what to expect today
- The Emini gapped up on the open and formed consecutive bull bars with bars 1-2. This increased the odds of the Bulls having a second leg up. The Bulls tried to get the second leg up with bar 8. However, it failed and led to a possible double top.
- Bar 11 failed to break below the opening range, forming a possible wedge bottom. The bulls are hopeful that the rally above 11 will lead to an upside breakout and a measured move up of the opening range.
- The bulls want to test above yesterday’s high. This means traders should be mindful of it as it is a likely target for the market to try and reach.
Yesterday’s Emini setups
Richard created the SP500 Emini chart – Al travelling.
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
Richard created the SP500 Emini chart – Al travelling.
EURUSD Forex market analysis
EURUSD Forex daily chart
- The EURUSD has been in a bear channel below the moving average for several bars.
- Yesterday, a downside breakout was formed, and a new low was found on the daily chart. While this is good for the bears, there is an increased risk that it is a 2nd leg trap that will find profit-taking.
- Channels typically evolve into trading ranges. This means that the recent January 2nd bear breakout may get bad follow-though and lead to an attempt at a reversal up.
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.
