E-mini S&P selling continues, but looking for reversal

Brooks Price Action - 09-26-2012 Wednesday

pending chart 1550

Consecutive sell climax at 60 minute trendline, higher low major trend reversal, higher high major trend reversal.

  • Wednesday, September 26, 2012
  • Bar 1 - Yesterday = strong bear. Wedge 69 78, did not gap below low of yesterday, but bear body. Don't buy or long. Swing sell or short below. Bears should have been strong enough to create gap below low of yesterday
  • Bar 2 - Big bear bar, close on low. Ok sell or short but might get low of the day soon since consecutive sell climax and near support and/or resistance
  • Bar 5 - Two bar reversal but 4 bear bars. Don't buy or long. Unless get strong bull reversal bar, do not buy or long or only buy or long with weekly calls. Might get major trend reversal bottom today after consecutive sell climax down to support and/or resistance, but need trendline breakout first. If get any bottom in next few bars, it is to buy or long for breakout above trendline and not for bull trend. No bull trend until major trend reversal. A firm just breakout test or bought 20,000 weekly puts, so they expect more down.
  • Bar 6 - Breakout pullback sell or short but doji. Measured move just below
  • Bar 8 - Two legged pullback in a bear move but dojis, tight trading range. Scalp only or wait since might be final flag. Consecutive sell climax so should get approx. Ten bar, two-legged correction sideways soon, but since spike and channel so big, it might be 10 bars on 15 minimum or minutes chart.
  • Bar 9 - Two inside bars two legged pullback in a bear move sell or short but tight trading range so swing only. Many important targets below including bottom of 60 bull channel = thick red line. Market keeps falling through other support and/or resistance levels. Back into tight trading range from a couple of weeks ago so probably will enter tight trading range
  • Bar 13 - Small bull bar so don't buy or long. Breakout pullback sell or short but just above 60 minimum or minutes channel so might not be much more down
  • Bar 14 - Big bear bar thru 60 minimum or minutes channel so might be sell vacuum and near low of the day. Should trade up to top of trading range from 2 weeks ago around 1432, but the stall and get trapped in that trading range
  • Bar 15 - Consecutive sell climax, 1b final flag 13, bull inside bar at major 60 minimum or minutes support and/or resistance so might be low of the day. Bottom of 60 minimum or minutes channel, measured move from 60 trading range last week, bottom of 5 minimum or minutes channel. Ok swing buy or long but better to buy or long weekly calls since less stress, or wait. Should be forming low of the day here or soon, but doubt will get strong bull yet since first have to get above top of 5 minimum or minutes channel and then pullback and get major trend reversal. Probably better to not look to sell or short down here
  • Bar 17 - Breakout pullback sell or short but buyers below. Still on 15 buy or long
  • Bar 20 - Bull two inside bars. Two legged pullback in a bear move sell or short but probably would become final flag. Better to not and wait to see if get reversal up. Bulls see as micro double bottom 14. Could get breakout here. Targets = moving average and then 5 high = reasonable buy or long setup
  • [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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