Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

Emini Outside-Down Reversal At Big Round Number

Published 01/17/2018, 10:35 AM

I will update around 6:55 a.m.

Pre-Open Market Analysis


Yesterday, the Emini reversed down from a breakout above 2800 and became an outside down day. This was the 1st bear day in 2 weeks. The odds are that the past 2 weeks on the weekly chart will be an exhaustive buy climax. This means that there will be a reversal to test the bottom of the 2 bars. That is also a test of the open of the year. In addition, it will probably be a 5% correction down to the 20-week exponential moving average.

The two bears bars on the weekly chart are strong enough so that there might be one more leg up before a pullback. In addition, the reversal will be minor. This means that the bulls will buy the selloff, even if it is surprisingly big or lasts 2 – 3 months.

Has the selloff begun? The bears need a couple big bear bars on the daily chart or 3 – 4 smaller bear bars. Without that, the odds continue to favor higher prices. Furthermore, after 10 bull days, the odds favor a trading range before Friday’s vote on a government shutdown.

Overnight Emini Globex Trading


The Emini is up 10 points in the Globex market. Look at any big bear bar on the daily chart over the past year. Most were followed by sideways to up prices over the next 1 – 3 days. Consequently, the odds are against a consecutive big bear trend day today. More likely, the Emini will spend a lot of time in the middle of yesterday’s big range. It probably will form an inside bar on the daily chart, and be mostly a trading range day.

However, whenever something is likely, traders always have to be ready for what is unlikely. The biggest trends up or down come from days that were likely to be trading range days.

Yesterday’s Setups

Emini S&P 500

Here are several reasonable stop entry setups from yesterday. I sometimes also show limit order entries and entries on the close of bars.

Latest comments

It was not an outside down day. The low of the day did not break Friday's low.
Your odds are inaccurate 95% of the time
More like 99.9%
i am following him more than one year The odds are inaccurate 105%
Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.