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Emini Second Entry Sell Close on Low

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Trading Update: Friday October 18, 2024

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S&P Emini market analysis

Emini daily chart

  • The Emini formed a bear bar yesterday, closing at its low. This created a second entry sell, which increased the risk of more bulls taking profits.
  • The channel up is tight, which lowers the probability for the bears.
  • The 6,000 round number holds significant influence over the market, acting as a powerful magnet. With the market just 100 points away, it may struggle to break free from its gravitational pull.
  • This means there is an increased risk of a buy vacuum test of the round number before the bears can get a pullback.
  • The bears know the round numbers are important, and if they think that the market will reach it, they will not sell just under the budget. Instead the bears will raise their sell orders higher up to the 6,000 round number.
  • The opposite for the bulls. If they believe the 6,000 round number will be reached, they will be less willing to take profits under the magnet.
  • Overall, the best the bears can hope for is a minor reversal, which means a trading range and not a major reversal to the downside.

Emini 5-minute chart and what to expect today

  • The Globex market has rallied in a tight bull channel on the 15-minute chart since last night’s sell climax bar at 8:45 PM EST.
  • The bulls want the selloff on bar 1 to become a higher low (Globex 15-minute chart), leading to higher prices.
  • The bears formed a big bar with bar 1. Generally, big bars often get second legs. However, the context is bad for the bears. It is forcing bears to sell low in a trading range with big risk.
  • Because Bar 1 is a big bar, there is an increased risk that it will get retested later today. This means that bulls buying the reversal up from bar 2 will likely have to exit below a second entry sell.
  • Because yesterday is a second entry sell on the daily chart, and it closed at its low, there Is an increased risk that the market will have to trigger the sell on the daily chart. This means that bar 2 is probably not going to be the low of the day.

Yesterday’s Emini setups

SP500 Emini 5-Min Chart Wedge Bottom Then a Trading Range

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 has been in a tight bear channel since the September 25th high.
  • The market is getting near the August 1st low and will probably reach it even if there is a pullback first.
  • The October selloff has made the market Always In Short. However, the risk is getting big for the bears.
  • While the October selloff is strong, it is forming a possible parabolic wedge. Because the risk is getting big, there is an added risk that bears will take profits above any bull bar closing near its high.
  • The bears who take profits know that any reversal up is likely going to be minor and will look to sell again on a reversal back down.
  • The market may have to pull back for a couple of legs and test the moving average. Even if the bears reach the moving average, the odds are that it will be a minor reversal, and the market will retest the current October low.

Summary of today’s S&P Emini price action

SP500 Emini 5-Min Chart Triangle Open Then Bull Trending Trading Range Day

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.

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