E-mini S&Ps close Monday with bear breakout

pending chart 1540

Weak bear channel, trending trading range day

  • Monday, September 17, 2012
  • Bar 1 - Yesterday = buy climax, bear channel, wedge bull flag. Trading range since 48 and since 71. Target below = 60 minute 20 bar exponential moving average, above = 66 and 35 high. Breakout mode. 10 bars up is not enough on 5 minimum or minutes, since 70 bars down from 11, so look at 15 minimum or minutes. Should get approx. Ten bar, two-legged correction sideways to up on 15 minimum or minutes. Small doji so trading range bar in tight trading range 71 and big trading range 48. Wait
  • Bar 2 - Or sell or short but 2 bull bars. Wait
  • Bar 5 - Breakout pullback 78, dbpb, two legged pullback in a bull move 1, wedge 80 1, but 2t tail. Better to wait. Might be sellers below 76 bottom of wedge
  • Bar 7 - Fail, failure two legged pullback in a bull move, but tight trading range and just above wedge bottom 76. Wait. Don�t want to get down 4 � 5 points early in tight trading range, which is bad for stop entries. Be patient and wait for better setups
  • Bar 8 - Fail, failure two legged pullback in a bear move but tight trading range so wait
  • Bar 10 - Two legged pullback in a bear move but bull body and tight trading range. Wait.
  • Bar 12 - Breakout, ok swing buy or long on close or as forming. Bulls need breakout above yesterday 65 low . That level has been support and/or resistance for 40 bars and is middle of tight trading range. Most test have failed so bulls need follow through, else another fail, failure
  • Bar 13 - Doji so weak follow through. Fail, failure breakout but weak signal bar so better to not sell or short, but bulls will be quick to get out. Swing bulls have stops below 12, or 11 bottom of spike, but will get out sooner if this begins to fail, failure. Bulls need buyers below
  • Bar 28 - Still in tight trading range, but probably always in long since best move up or down was 5 bar bull spike to 13, and still above bottom of yesterday wedge. Swing traders could buy or long market with stop below 17 or 22 or 26, holding for 2x risk. Better to wait for breakout and then decide
  • Bar 50 - Close on low. Forming bear channel = lower highs and lows all day. Might get bear breakout and test 60 minute 20 bar exponential moving average. 90% chance of breakout up and or down since range only 4.25 and that has happened only once in 3 years
  • Bar 53 - Bear breakout, probably more down but small breakout bar
  • [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.

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