Trading Update: Tuesday February 6, 2024
S&P Emini pre-open market analysis
Emini daily chart
- The Emini formed an inside bar yesterday below support, following the upside breakout to the 5,000 big round number.
- It is common for the market to pull back for a couple of bars after testing an important round number, especially one as important as 5,000.
- The bears are hopeful that the two bull bars last week is a final buy climax leading to a reversal down. While this is possible, the bears the bears can expect a trading range.
- The market is in a small pullback bull trend on the daily chart. Strong trends typically evolve into trading ranges before they can evolve into opposite trends. This means that there are likely buyers back at the moving average.
- Overall, yesterday formed a high 1 buy signal bar; however, it is a bear body. This increases the odds of sellers above for a bar or two and trend resumption for a retest of the 5,000 big round number.
Emini 5-minute chart and what to expect today
- Emini is up 9 points in the overnight Globex session.
- The Emini sold off during the overnight hours. However, it was a retest of support (50% pullback) from trapped bears around yesterday’s low.
- The bulls got a reversal up around 7:45 AM EST and are now trying to get a second leg up and a test of yesterday’s high.
- Traders should assume that today will have a lot of trading range price action on the open. Most traders should consider not trading for the first 6-12 bars unless they can trade with wide stops and limit orders.
- Traders should pay attention to yesterday’s high as it will likely be a magnet going into the open session.
Yesterday’s Emini setups
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.
EURUSD Forex market trading strategies
EURUSD Forex daily chart
- The EURUSD reversed down over the past two days, after a strong bull bar last Thursday (February 1st).
- The Bulls are hopeful that today will reverse up strongly; however, after two consecutive bear bars, the first reversal will probably fail.
- The problem that the bears have now is that the market is near support, the December low.
Summary of today’s S&P Emini price action
Al created the SP500 Emini charts.
End of day video review
End Of Day Review was presented in the Trading Room today. See below for details on how to sign 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.
