Pre-Open market analysis
Yesterday was a small trading range day. Since Tuesday was a bull day that reversed up from the 20 day EMA, it was a buy signal bar on the daily chart. When yesterday went above Tuesday’s high, it triggered the buy signal. However, since the Emini has sold off for 5 days, yesterday is a pullback in a bear trend. It is therefore a minor sell signal bar for today. But, it is a doji and it followed a big bull bar. Therefore it is a weak sell signal, and there are probably more buyers than sellers below its low.
The weekly chart is still on a weak sell signal. The two day reversal has been strong enough to generate confusion. Confusion usually leads to a trading range. Therefore, the odds are against a big move up or down today.
Because last week’s range was small, the bulls have a 40% chance of going above last week’s high. Since it reversed up from below last week’s low, this week would then be an outside up week. That is a sign of strength. But, the resistance of the March high is just above. Until the bulls break above it, there is no breakout. Therefore, the 5 month trading range is still in effect.
Overnight Emini Globex trading
The Emini is down 3 points in the Globex market. Today will probably trade below yesterday’s low. That would trigger a sell signal on the daily chart.
There will likely be more buyers than sellers below yesterday’s low since it is a weak sell signal. Furthermore, yesterday was a small day. Therefore, a reversal up from below yesterday’s low would have a 30% chance of continuing to above yesterday’s high. Today would then be an outside up day, which is a sign of buying pressure.
With most days being mostly sideways, the odds are that today will have a lot of trading range trading again.
Yesterday’s setups
Here are several reasonable stop entry setups from yesterday. I sometimes also show limit order entries and entries on the close of bars.