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Emini Climactic Rally Test of 5,000

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Trading Update: Tuesday February 13, 2024

S&P Emini pre-open market analysis

Emini daily chart

  • The Emini is getting climatic, and the odds favor a test back to the moving average and the big 5,000 round number.
  • I mentioned yesterday that February 8th formed a bull inside bar late in a bull trend. Inside bars are triangles on smaller time frames, increasing the odds of a pullback within 1-2 bars after any upside breakout of the inside bar.
  • While the odds favor a selloff back to 5,000 and the moving average, the best the bears can expect is a trading range and a bear trend.
  • The bears need to show more signs of strength before traders will believe that a bear trend is underway. At a minimum, the bears need to get strong closes below the moving average.  

Emini 5-minute chart and what to expect today

  • Emini is down 65 points in the overnight Globex session.
  • The Globex market formed a strong downside breakout during the 8:30 AM EST report and reached the 5,000 big round number, the first target for the bears.
  • The open is likely to get a big gap down on the open.
  • Traders should expect the bears to get a second leg down. However, the market will probably have to go sideways on the open first.
  • As I often say, the open will probably have a lot of trading range price action. This means that most traders should consider not trading for the first 6-12 bars unless they are comfortable with making quick decisions.
  • Because of the big gap down, there is an increased risk of a trend day. If there is going to be a trend day, the odds favor a bear trend.
  • Most traders should try and catch the opening swing, which often begins before the end of the second hour, after the formation of a double top/bottom or a wedge top/bottom.

Yesterday’s Emini setups

Emini 5-min Bull Trend from Open Then Reversal Down

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 formed a downside breakout, which was the second leg down following the February 5th two-bar bear breakout.
  • The bears are hopeful that the bulls are giving up and the market will lead to lower prices.
  • The bears are beginning to form a second negative gap; this will increase the risk of a possible small pullback bear trend, leading to lower prices. The negative gaps are the breakout on January 16th and the bear breakout on February 5th.
  • The bulls are hopeful that today will form a large tail below the bar, indicating buying pressure into the close. This will increase the odds or a pullback and sideways trading.
  • The bulls need to get closes above the moving average if they are going to get any chance at transitioning the market into a bull trend. Without a strong breakout with closes above the moving average, the best the bulls can expect is a trading range.

Summary of today’s S&P Emini price action

SP500 Emini 5-Min Chart Wedge Bottom and Then Wedge Top

Al created the SP500 Emini charts.

End of day video review

End Of Day Review will be 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.

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