Trading Update: Monday February 26, 2024
S&P Emini pre-open market analysis
Emini daily chart
- The Emini found profit-taking last Friday after the market reached a new high for 2024.
- Traders are becoming more interested in buying closer to the moving average. This is a warning that the market is losing momentum.
- Because the breakout last Thursday was strong, it will likely get a second leg up. This increases the odds that the first reversal down will fail.
- The Bears need to limit any second leg-up following Thursday’s upside breakout.
- The bears want to form a strong entry bar today following Friday’s bear signal bar.
- More likely, the bears will need a second entry sell in order to convince traders they have taken control.
- Overall, the daily chart will probably go sideways over the next several days.
Emini 5-minute chart and what to expect today
- Emini is up 3 points in the overnight Globex session.
- The Globex market has gone sideways for most of the overnight session.
- Traders should expect the open to have a lot of trading range price action and go mostly sideways on the open.
- Most traders should consider waiting for 6 – 12 bars unless they are comfortable making quick decisions and trading with limit orders.
- There is an 80% chance of a trading range open and only a 20% chance of a double top/bottom or a wedge top/bottom.
- Most traders should wait for the opening swing that often begins before the end of the second hour after forming a double top/bottom or a wedge top/bottom.
- The opening swing is important because it often provides great risk/reward, with decent probability, and will often last for at least two legs and often two hours.
Friday’s Emini setups
Al created the SP500 Emini charts.
Here are reasonable stop entry setups from Friday. 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 is continuing to go sideways above the 20-period moving average.
- The bulls are hopeful they will be able to stabilize above the moving average. This would increase the odds of higher prices.
- The bears see the market as a trading range or a bear trend. They are hopeful that they will be able to form a double top with the February 2nd high. However, sideways is more likely.
- Because of the 9-bar bull microchannel, the odds are the first reversal down will fail to go far.
- Overall, the EURUSD will probably go sideways for the next several weeks.
Summary of today’s S&P Emini price action
Al created the SP500 Emini charts.
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.
