S&P 500 Futures Emini pre-open market analysis
Emini daily chart
- The Emini closed as an inside bar last Friday. Inside bars are breakout mode patters, and this will increase the odds of a breakout above or below last Friday’s bar.
- The bulls want a second leg up following the strong rally up to the July 19th high, and they will likely leg a second leg.
- However, the bears now have a three-bar bear microchannel, increasing the odds of a second leg down. This means that there may be more sellers above last Friday’s high for a brief second leg down.
- There are probably buyers below any bar which will limit the downside.
- The bears are hopeful that last week’s bulls breakout is exhaustion and will lead to a pullback to the June high. while this is possible, the bears will need to develop more selling pressure before they can get a reversal of the recent bull rally.
Emini 5-minute chart and what to expect today
- Emini is up 9 points in the overnight Globex session.
- The Globex market has been in a tight trading range on the 60-minute chart.
- The Bulls recently got a small upside breakout that will probably get a second leg up.
- Due to the market having an inside bar on the daily chart last Friday, the open will probably have much sideways trading. This means most traders should consider not trading the first 6-12 bars and wait. Most
- Traders can also consider waiting for the opening swing trade to develop and enter on a stop entry trying to catch it.
- Most of the time, a double top/bottom or a wedge top/bottom forms before the opening swing trade begins.
- The most important thing to remember is to be open to anything and patient. There are 81 bars to the day which means there is plenty of time to place a trade.
Friday’s Emini setups
Here are several reasonable stop-entry setups from Friday. I show each buy entry with a green rectangle and each sell entry with a red rectangle. 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.