S&P Emini market analysis
Emini daily chart
- The S&P 500 Emini formed a bear bar closing on its low yesterday. The Bears want a double top with the December 6th and 11th high. The bears will likely be disappointed, and any selloff will likely be minor.
- Next (LON:NXT), the bears want a break of the December 10th neckline, followed by a measured move down the 6-day tight trading range.
- The channel up is tight, increasing the odds that the bears will be disappointed, and the market will go sideways.
- The bull channel is weakening and likely evolving into a trading range. The bears have done a great job of making the market go sideways. However, they need to do more.
- Ideally, the bears need follow-through selling below the moving average. Ideally, the bears need 2-3 consecutive bear bars closing below the moving average. The odds favor a trading range, and the market goes sideways without this.
- Channels evolve into a trading range. For the bull channel to end, the market must fall below November 15th, the highest recent high low.
Emini 5-minute chart and what to expect today
- The Emini gapped up on the open and formed an opening reversal with bar 4. This increases the chances that bar 4 will be the day’s high.
- The bears need to do more than the selloff to bar 6 to convince traders that the day’s high is in.
- The bulls want a higher low major trend reversal and will look to buy the selloff below bar 1.
- As of bar 6, a trading range is more likely than a bear trend. This means that the market will probably find buyers somewhere between the bar 1 low and yesterday’s low.
- Yesterday, a bear bar closed on its low on the daily chart. The bears want the market to trigger the sell below yesterday’s low. This increases the risk of the market needing to test down to yesterday’s bar 81.
- The selloff to bar 7 is strong enough that the odds favor a 2nd leg down. This is good for the bears and increases the odds of today forming a bear trend, or a trading range day, but not a bull trend.
