Trading Update: Wednesday July 10, 2024
S&P Emini pre-open market analysis
Emini daily chart
- The daily chart has a six-bar bull micro channel, which is a sign of strong buying. The problem for the bulls is that the bodies are getting weaker and forming bear bars. This is a sign of momentum loss, which increases the odds of a pullback and an end to the microchannel.
- Traders should pay attention to yesterday’s low as it will be a magnet. The odds favor an end to the bull micro channel, which increases the odds of a selloff sometime today.
- The daily will likely pull back over the next several weeks. The bears first need to stop the buying pressure, which they are beginning to accomplish right now.
- Next, the bears need to accumulate bear closes. Once they can make the market go sideways for several bars, that will increase the odds of a test of 5,500 and the moving average.
- Overall, traders should expect today to disappoint the bulls, close below yesterday’s high, and possibly test down to yesterday’s low.
Emini 5-minute chart and what to expect today
- The Globex market went sideways during the overnight and early morning hours.
- This increased the odds of the U.S. Session getting a trading range on the open.
- Yesterday’s high is important, and the bears want to prevent the bulls from getting a close above it.
- Because the daily chart is in a six-day bull micro channel, the market may try to test it down to yesterday’s low and end micro channel.
- Because the channel up is tight on the Globex chart (15 minutes), traders should assume that the bears will need to develop more selling pressure before they will have a chance at getting a bear breakout.
- As if bar 12, the bears formed a reversal down of the rally up to bar 9. This was expected because of the rally on the 15-minute Globex chart being overbought.
- The next target for the best is the bar 2 low, which is the bottom of the most recent buy climax.
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.
