Pre-Open market analysis
The Emini sold off after the FOMC announcement yesterday to below Tuesday’s low. It then rallied to above Tuesday’s high. Yesterday was therefore an outside up day. That is a sign of strong bulls. Because of the 4-week rally, the odds favor a new all-time high within a few weeks.
Yet, there is still a wedge rally and a double top on the daily chart. Also, the Emini is at the top of a 2-year trading range. Furthermore, the ledge top at 2940 on the weekly chart is a magnet below. Finally, most days over the past 3 weeks have had a lot of trading range price action on the 5 minute chart. Consequently, while the Emini is working higher, it is not racing up. Also, because of the loss of momentum at resistance, there can be a strong reversal down at any time.
Overnight Emini Globex Trading
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. 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.
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.