S&P 500 E-Mini Pullback to High 1 likely
2023.12.04 10:08
Emini daily chart
- The rallied last Friday, breaking above the prior day’s High 1 buy signal bar. The market will probably pull back today and test the recent High 1.
- While the channel up is tight, the odds favor a test of the moving average soon. The market can reach the moving average by going sideways or selling off to the moving average.
- Because the channel up is tight, the odds favor sideways at the moving average, not a s strong breakout below it.
- It is possible that last Friday was a buy vacuum test above the September 1st high. The market had a perfect double top with the September 1 high last week, and the odds favored the double top failing to have an equal high.
- Overall, the market will probably go sideways soon and test the moving average.
Emini 5-minute chart and what to expect today
- Emini is down 35 points in the overnight Globex session.
- The Overnight Globex market recently formed a strong downside breakout after failing to break out above the November 28th high, which was the equal high (double top) with the September 1st high.
- The recent selloff on the 60-minute chart is strong enough for the market to get a second leg down.
- The bears want the market to gap down and form a strong bear trend day.
- More likely, the gap down will lead to sideways trading on the open, which will drag the moving average higher.
Friday’s Emini setups
Here are reasonable stop-entry setups from Friday. 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.
