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Emini Sellers above Yesterday’s High

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Trading Update: Wednesday August 7, 2024

S&P Emini pre-open market analysis

Emini daily chart

  • The Emini formed a bull bar yesterday but failed to close above Monday’s high.
  • While the bulls have done a good job halting the selling, a trading range is more likely than a strong reversal. This means the odds favor sellers above yesterday’s high and disappointed for the bears.
  • While the selling pressure has been strong by the bears, it is getting climactic, and the odds favor a couple of legs sideways to up.

Emini 5-minute chart and what to expect today

  • The Rally up to the bar formed a series of bull bars; however, the rally has too much overlap, which increases the odds it is a failed breakout for the bulls.
  • The bears formed a strong reversal bar with bar 7, which increased the odds that bulls who bought the close of bar 6 would be interested in exiting back at the high close. This is why the market reversed down on bar 9.
  • The odds favor a test of the bar 1 low over the next several bars.
  • The 5,300 round number is a possible magnet that the market will test. This means traders should be mindful of a sell vacuum test of the round number.
  • Bar 10 formed a strong enough bar breakout that the odds favor a 2nd leg down and a test of the bar 1 low.
  • While the bulls did a good job collecting a series of bull bars that broke above yesterday’s high, the rally lacked consecutive strong closes. This increases the odds that the rally is a bull leg in a trading range.
  • The bears want a strong breakout below the bar 1 low and a measured move down from the high of bar 7 to the low of bar 1, projecting down to 5,287.
  • Since today might be a trading range day, it is possible that the market gets a measured move from the high of bar 1 to the open of the day, projecting down. That would put the open of the day exactly in the middle of the day’s range, increasing the odds that it gets retested later in the day.
  • The bears formed a 2nd leg down with bar 12. However, the selloff had a lot of overlap. This increased the risk of a trading range, and the market needed to retest the bar 8 high 1 buy signal bar to allow the trapped bulls out of their losing trade.
  • The bears want bar 20 to form a 2nd entry short and a double top with bar 7 high. Next, they want a break below the neckline (12 low) and a measured move down.
  • The bulls want a strong breakout above the seven high and a measured move of the opening range.

Yesterday’s Emini setups

End Of Day Review will be presented in the Trading Room today. See below for details on how to sign up.

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

SP500 Emini 5-Min Chart Lower High Double Top MTR Small Pullback Bear Trend

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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