Trading Update: Wednesday October 2, 2024
End of day video review
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S&P Emini market analysis
Emini daily chart
- The Emini formed a bear bar closing above Monday’s high 1 buy signal bar.
- Yesterday came within 10 points of the 20-day moving average, which is a likely support level.
- The market will likely have to test closer to it. Because of the daily moving average and yesterday’s tail below the bar, the odds that there are buyers below yesterday’s low are increased.
- The bulls are hopeful that today will form a bull reversal bar closing on its high. Even if today does form a bull bar closing on its high, it is still following a four-bar bear microchannel, which increases the odds of sellers above today’s high.
Emini 5-minute chart and what to expect today
- The Emini sold off for the first three bars of the day. However, it formed a parabolic wedge and reversed up with bar 4.
- Bar 4 is a strong enough reversal bar that the odds favor a second leg up.
- The bears are trapped with bar 4 and are trying to cause a pullback after bar 4 to allow the bears out with a smaller loss.
- The bulls know this and are trying to add to the buying pressure. They want to squeeze the bears out of their trade, which will lead to an upside breakout.
- The bulls are hopeful that the market will get a measured move up of the opening three-bar bear breakout.
Yesterday’s Emini setups
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.
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.
