Trading Update: Wednesday March 30, 2022
Emini pre-open market analysis
Emini daily chart
- The current rally is very climactic, with only one bear bar in 11 bars, so the odds are we will see Emini sideways likely for a few days to relieve the exhausted bulls.
- The daily chart closed above the February high and 4,600 big round number.
- The rally from the March 14 low has been in a tight channel, so any reversal down is likely to be minor.
- The market is always in long, and there is probably around a 50% chance of a new all-time high. Everyone has the question of how deep the pullback will be before the market reaches or gets closer to the all-time high.
- The bulls hope to get a measured move of the February trading range. Any breakout above the all-time high will likely fail, and the market will likely continue sideways.
- The bears want a failed breakout of the February high. Next, they want a major trend reversal setup that tests back down to the February low.
- The bears know that the current rally is too strong to sell, so they will likely wait for a minor reversal before looking for a sell setup.
- Ultimately, the bears do not care if the market reaches the all-time high. If it does, the bears will want the market to go sideways and form a lower high or a higher high major trend reversal and selloff back down to the February low.
Emini 5-minute chart and what to expect today
- The market is currently down 10 points in the Globex session.
- The daily chart has had four consecutive bull days, so the odds favor a bear close today.
- Traders should be open to a bear trend from the open and look to sell if there are consecutive big bear bars.
- Traders should pay attention to the open of the day. If today is primarily a trading range, the market will probably test the open of the day multiple times.
- If the market is not far above the open of the day late in the day, traders should look for a sell setup since the odds favor a close below the open.
- As always, if today is a trading range, traders should look to buy in the bottom 1/3 and sell in the top 1/3 or the range.
Yesterday’s Emini setups
Al created the SP500 Emini charts.
EURUSD Forex market trading strategies
EURUSD Forex daily chart
- The bulls got a bull breakout bar yesterday. However, it had a big tail on top, disappointing for the bulls.
- Yesterday was likely a strong enough surprise bar that the market will probably get a second leg up at a minimum.
- The bears are hopeful they can create a failed breakout of the March high and form a swing short that would set up a wedge top.
- The bulls still are hoping for the bull breakout of the March bear flag.
- While the odds favor the upside breakout, the bulls’ probability is not yet high.
- The bulls need today’s follow-through bar to close above the March high, which would increase the odds of the market going higher and possibly a measured move up.
Summary of today’s S&P Emini futures price action and what to expect tomorrow
- Al Brooks on London PA Symposium and overseas break.
- No Emini Daily Setups charts until Monday April 11, 2022.
End of day summary
- Note: The chart above is in central time zone. I was unable to adjust the chart to reflect pacific time.
- The Emini opened in a trading range for the first 18 bars, leading to a downside breakout.
- Since the market was in a trading range for the first 18 bars, the downside breakout has an increased risk of a trending trading range and more trading range price action, which is why the market continued sideways into the third hour of the day.
- The bears continued to channel down in a broad channel, which led to a downside breakout with less than 2 hours left in the day.
- Since the bear breakout late in the day was climactic, late in a broad bear channel, there was an increased risk of a rally into the close.
- Another thing to point out is that when you have a sell the close market that starts before 12:30 Pacific, it will usually fail to continue down into the close.
- Overall, the day was a trending trading range day, and when you have 2-3 breakouts that lead to trading ranges, the odds begin to favor one of the tradings ranges, becoming a magnet and acting as a final flag.
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
Traders can see the end of the day bar-by-bar price action report by signing up for free at BrooksPriceAction.com. I talk about the detailed S&P Emini futures price action real-time throughout the day in the BrooksPriceAction.com on trading room days. We offer a 2 day free trial.
Charts use Pacific Time
When I mention time, 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.