Stock Analysis

Emini S&P 500: February Wedge Rally Testing 3400

The Emini formed an outside up day and another new all-time high. However, it sold off to close in the middle of the day’s range.The bulls hope that the 2-week rally is a resumption of the 4-month bull trend. If they keep getting bull bars closing near their highs, the odds will shift in favor of the rally reaching the weekly chart’s Leg 1 = Leg 2 target at 3468.However, there is currently an equal chance that it is a bull leg in a trading range than began around Christmas. The bears see the rally as a wedge since the January 29 high. If so, the Emini will test the January low at the bottom of the range by the end of March.Today is Friday so weekly support and resistance can be important. However, there are no nearby targets. Therefore the fight will be over whether or not the week closes on its high.

Overnight Emini Globex Trading

The Emini is up 5 points in the Globex session. It will probably open in or near yesterday’s 5-hour trading range. Since markets tend to continue what they have been doing, there is an increased chance of an early trading range.If that happens, today would likely be another mostly sideways day. Also, with Monday being a holiday, traders begin to think about waiting for Tuesday before aggressively trading again. That further reduces the chance of a big trend day.The daily chart is in a buy climax. Traders need to be ready for a Surprise Day up or down at any time.Most bars on the weekly chart have had conspicuous tails on top. This probably increases the chance of today closing down from this week’s high by 10 or more points.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.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.

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.

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.

Emini S&P 500: February Wedge Rally Testing 3400

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