Yesterday trade below last week’s low. This triggered a Low 2 top sell signal on the weekly chart. However, it immediately reversed up into a bull trend day. Yesterday is now a buy signal bar on the daily chart for today.
The Emini is reversing up from around the bottom of a 4 week trading range in a bull trend. Also, there are 3 consecutive shrinking expanding triangles on the 60 minute chart. While difficult to see, they are there. The failed bear breakout increase the chance of a rally. Traders expect higher prices today or tomorrow. But traders might wait for Thursday’s unemployment report before they will look for a breakout.
Because the Emini has been in a trading range for a month, it is neutral. The bulls want a rally up into the gap on the weekly chart above the February 24 high. But the bears want a breakout below the trading range and a measured move down to around 2700.
They each have about a 50% chance. The probabilities change a little every day. For example, today is slightly more bullish after yesterday’s reversal up.
Since today is the final day of the month and of the quarter, monthly support and resistance are important. The Emini has been oscillating around the open of the month for 4 days. It will probably close around the month’s open and have either a small bull or bear body on the monthly chart.
The higher up in the June range that it closes, the better chance the bulls have of higher prices in July. The nearer today’s close is to the low of the month, the more likely July will trade down.
Overnight Emini Globex trading
The Emini is down 10 points in the Globex session. It will, therefore, be within about half of a day’s range of the open of the month. If it is within 20 points of the open of the month in the final hour, it will probably test the open of the month one more time.
Yesterday is a buy signal bar on the daily chart and the context it good for the bulls. Today will probably go above yesterday’s high and trigger the buys signal. But, because the Emini is in a trading range, there is a reduced chance of a big rally above yesterday’s high.
This is similar to yesterday when there was a sell signal bar on the weekly chart. I said before the open that it would probably go below last week’s low and trigger the sell signal. It did, and it reversed up.
With the daily chart in Breakout Mode, there is a 50% chance that if the Emini triggers the buy signal today, it will reverse back down within a day or two. Traders might be waiting for Thursday’s unemployment report before looking for a breakout of the 5 week trading range.
Yesterday’s setups
Here are several reasonable stop entry setups from yesterday. I show each buy entry with a green rectangle and each sell entry with a red rectangle. I rarely also show limit order entries and entries on the close of bars. I do not want the lines to be distracting. If they are longer, I make them dotted. But, they have to be visible, so I make the shorter ones solid. Buyers of the Brooks Trading Course and Encyclopedia of Chart Patterns have access to a much more detailed explanation of the swing trades for each day (see Online Course/BTC Daily Setups).
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.
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.