Trading Update: Friday June 4, 2021
Emini pre-open market analysis
Emini daily chart
- Yesterday broke below Tuesday’s low, giving an Emini triggered sell signal for the May 7/June 1 double top.
- Since yesterday had a bull body, it was a weak entry bar. The bears need bear bars today and next week if the reversal down will be successful.
- After 3 bear bars, yesterday was likely to be a bull bar, and it was.
- Yesterday tested below last week’s low, and back below the May 14 neckline of the May 12/May 19 double bottom, but reversed up and formed a bull reversal bar.
- Yesterday is a High 1 bull flag buy signal bar for today. The bulls want a breakout above the May 7/May 28 double top, which means a new all-time high.
- Big tail on top of yesterday’s bar, and middle of 8-day tight trading range, so not strong buy setup.
Weekly support and resistance can be important on Friday
- On the weekly chart, this week reversed down from above last week’s high, and then up from below last week’s low. This week is therefore an outside bar.
- But this week’s range so far is small, and the weekly chart has been in a tight range for 8 weeks. Therefore, this week is not a reliable buy or sell signal bar.
- Today is Friday and weekly support and resistance can be important.
- If this week closes below last week’s low, especially far below, there would be an increased chance of lower prices next week.
- If this week closes above last week’s high, which is unlikely, there will be an increased chance of higher prices next week.
Overnight Emini Globex trading on 5-minute chart
- Up 18 points in Globex session.
- Today will probably open in yesterday’s range.
- Bulls want trend resumption up from yesterday’s early rally.
- They want week to close above last week’s low, and above midpoint of this week.
- Unlikely to rally back above last week’s high.
- Bears want yesterday’s rally to be a bull trap in an early bear trend on the daily chart.
- At a minimum, they want this week to close below last week’s low.
- Day traders will begin the day expecting a continuation of yesterday’s trading range.
- They will look for either trend resumption up or trend reversal down. If there is a series of strong trend bars in either direction, they will switch to swing trading.
Yesterday’s Emini setups
EURUSD Forex market trading strategies
EURUSD Forex daily chart
- Yesterday was big bear day, and reversal down from Tuesday’s lower high double top with the May 25 high.
- It broke below the May 28 low, which is the neckline of the double top. It closed slightly below that low, which increases the chance of lower prices.
- Bears hope this is the start of a selloff to the May 5 bottom of the 2-month trading range.
- Big enough Bear Surprise Bar so that there should be at least a small 2nd leg sideways to down.
- If the bears get a 2nd consecutive big bear bar today, traders will look for a measured move down to below 1.20.
- Bulls want reversal up today or Monday for a wedge bull flag with the May 21 and May 28 lows.
- It would also be a High 2 bottom and double bottom with the May 28 low.
- This week is an outside down bar on the weekly chart. Bears want this week to close below last week’s low. That would increase chance of lower prices next week.
- The bulls want the week to close above last week’s low. That would reduce the chance of lower prices next week.
Overnight EURUSD Forex trading on 5-minute chart
- Traded just below yesterday’s low, but has been in small range.
- Bulls want today to have bull body, so that it would be a buy signal bar Monday, for a High 2 bottom with the May 28 low. Moves up and down in trading ranges often reverse after a couple legs.
- So far, today has a small range, and it is trading around last week’s low. Today is Friday so weekly support and resistance can be important.
- So far, day traders are scalping long and short.
- After several hours at yesterday’s low, and the bears unable to get a big bear day, today will probably not become a big bear day.
- Bulls hope for an upside breakout of today’s range. If they get a series of strong bull bars, day traders will switch to swing trading, betting that today will become a strong buy signal bar for Monday.
Summary of today’s S&P Emini futures price action and what to expect tomorrow
End of day summary
- Wedge rally for 2 hours and then minor reversal down to the EMA.
- High 2 and 20 Gap Bar buy at EMA, and then a Small Pullback Bull Trend that tested open of week.
- Close below open of week so small bear doji on weekly chart.
- Close just below all-time high so possible gap up to new all-time high next week.
- Bears want reversal down from double top with May 7 all-time high, but most reversals fail.
See the weekly update for a discussion of the price action on the weekly chart and for what to expect going into next week.
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 trading room. We offer a 2 day free trial.
Charts use Pacific Time
When I mention time, it is USA Pacific Time (the Emini day session opens at 6:30 am PT, and closes at 1:15 pm PT). You can read background information on the intraday market reports on the Market Update page.