E-mini S&P shows signs of bear breakout

Brooks Price Action - 08-30-2012 Thursday

pending chart 1528

Gap down, fail, failure breakout below 60 minute head and shoulders top neckline, double bottom higher low major trend reversal, late spike and channel with wedge top and trend resumption bear

  • Thursday, August 30, 2012
  • Bar 1 - Yesterday was trading range day. Market on breakout mode on daily. Gap down so might be start of big move on daily so good trader's equation for swing shorts, like put spreads on daily. Potential for big bear trend day. Far from moving average so probably have to go sideways before more down, but might get low of the day soon
  • Bar 3 - Bull two inside bars, ok buy or long for swing up for low of the day, but as long as gap down holds, might get big bear day and start of big move down on daily. Probably better to not buy or long and instead wait to see if get sell or short setup. Too difficult to manage as buy or long scalp so low probability
  • Bar 4 - Micro double top 1 but 2 dojis and small trading range. Ok swing sell or short but probably more sideways
  • Bar 7 - Reversal bar, two legged pullback in a bull move, 2nd attempt to reverse low of yesterday, but doji and probably always in short. Ok swing buy or long but better to wait. As long as no strong bull spike and gap remains open, better to look to bear trend day because of daily double top and 60 minimum or minutes lower high major trend reversal
  • Bar 10 - Fail, failure two legged pullback in a bull move, bear inside bar and only 1t tail. Ok swing sell or short. Might become sell or short closes and big bear day
  • Bar 11 - Big bear bar. Take some off if get 2 points since might get wedge bottom and low of the day
  • Bar 12 - Follow through so more down, but tail so might get pullback. Swing stop above 11, maybe 1t above 10 low
  • Bar 13 - Parabolic wedge, but only 1t body. Better to not buy or long, but bears can take some or even all off. Better to take some profits and swing balance since potential for big bear trend day
  • Bar 14 - Bear bar, close on low, but 3 sideways bars and not strong follow through after 11 so sideways more likely. Still always in short on swing sell or short
  • Bar 15 - Bull reversal bar but small. 2nd reversal. Better to wait to buy or long. Should have taken partial profits on shorts and better to swing balance. Should fall at least a couple more ticks for 4 profit target bulls from 10. Trend day, but too early to tell if spike and channel bear, trending trading range day, small pullback trading range, trend resumption. Bulls want trending trading range day that evolves into reversal day
  • Bar 17 - Big bear bar, consecutive sell climax, 1t fail, failure breakout below neckline of 60 minimum or minutes head and shoulders top so might enter trading range. Still always in short and ok to swing part with be(breakeven) stop. Too early to buy or long since tight channel. Might go sideways for hours. Bulls want low of the day since bottom of 60 minimum or minutes trading range
  • [more Bar-by-Bar Analysis in the Forums at www.brookspriceaction.com]
About the Author
Al Brooks

Al Brooks, M.D., is author of the Brooks Trading Course (27 hours of videos at BrooksTradingCourse.com), several books on Price action (Reading Price Charts Bar by Bar: The Technical Analysis of Price Action for the Serious Trader, Wiley, 2009, and the 500,000 word, three-book series, Trading Price Action, Wiley, 2012), and numerous articles in Futures Magazine. He also provides live intraday E-mini price action analysis and free end-of-day analysis on www.brookspriceaction.com.

Originally published on BPA Forums. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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