Trading Update: Thursday May 22, 2025
S&P Emini market analysis
Emini daily chart
- Yesterday, the Emini sold off, breaking below the low of the past six days. This was due to the market getting too far above the moving average late in the bull channel.
- The moving average reflects the fair price, and whenever the market gets too far away from the moving average for too much time, the odds favor retracement back to the average.
- The market has still not reached the 6,000 round number, and the odds favor a test of it.
- Yesterday was a strong enough surprise that the odds favor at least a small second leg down and sideways.
- This increases the odds that the market will probably not form a strong bull reversal bar and undo yesterday’s bear breakout.
- Because the market’s been in a tight bull channel on the daily chart today, it’s likely not to form a strong follow-through bar closing on its low. Instead, today will probably create a disappointment bar.
- Overall, yesterday is enough of a surprise that the odds favor at least a small second leg down and the price getting to the moving average.
Emini 5-minute chart and what to expect today
- Today opened at yesterday’s close and formed an outside down bar on bar one, followed by a reversal bar with bar two.
- Yesterday’s channel was likely to evolve into a trading range, and therefore, the odds were that there were buyers below the one low. This led to the rally to the 8 high and the market going above yesterday’s bar (75), the most recent major lower high.
- Channels typically evolve into trading ranges, and not opposite trends. This means the odds are against the bulls getting a strong bull trend today.
- Overall, today will likely have a lot of trading range price action. The bulls want to start testing major lower highs and ultimately get back to yesterday’s bar 50 lower high. However, the bulls need to form more buying pressure if they are going to reach it.
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.
Emini end of day video review
Periodic end of day review videos will be moved to top of page when done.
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 Brooks Price Action trading room. 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.
