Al Brooks provides bar-by-bar analysis on a five-minute chart of the previous day’s prices action in the E-mini S&P 500. This is his analysis for Friday, June 20, 2014.
- Bar 1 - Gap to top of channel on weekly chart and above 60 minimum or minutes leg 1 equals leg 2 measured move target. Bear body, swing sell or short below, possible high of the day, but tail so lower probability and better to wait
- Bar 2 - Bear follow through but big tail, still 1t above high of yesterday so might get opening reversal buy or long soon. Consecutive bear bars so might be always in short, but need to close gap and get close on low
- Bar 4 - Opening reversal above high of yesterday, swing buy or long, but 3 consecutive bear bars so always in short and slightly more likely sell above or sellers at the high of the bar and probably scaling in higher. Close to 50-50. Breakout mode
- Bar 7 - Fail, failure breakout high of yesterday second entry sell but tight trading range, bad for scalping with stop entries unless using swing stop. Still on swing sell or short and swing buy or long. Breakout mode
- Bar 10 - Lower high major trend reversal, close on low, still always in short, ok swing sell or short but still low probability since tight trading range, bad for scalping with stop entries unless using swing stop. Bulls still on 4 buy or long
- Bar 13 - Two legged pullback in a bull move opening reversal at moving average, ok swing buy or long for low of the day. Bears will exit above 13, 12, or 9. Bulls will buy or long or wait for bull breakout. Trading range price action
- Bar 16 - Two legged pullback in a bull move second entry buy, ok swing. Range only 3.5 points so probably will double after breakout up and or down
- Bar 18 - Breakout but small and below 9 lower high so swing bears will sell or short, stop above 9. Bulls need breakout above 11 lower high
- Bar 19 - Breakout above 9 lower high, 4 consecutive bull bars, always in long, stop below 16. Bears want double top and high of the day
- Bar 23 - Double top but 12 bar bull microchannel so probably buy below or buyers at the low of the bar and probably scaling in lower. Low probability swing sell or short for possible high of the day
- Bar 28 - Dtpb, swing only since tight trading range, bad for scalping with stop entries unless using swing stop. Trading range since 46 yesterday so might fall to new low of the day and test down and become larger trading range
Small trading range day. Touched top of weekly channel. Odds favor fail, failure bull breakout and then reversal down to bottom of channel.
Ed Note: Each trading day going forward, traders can listen to live, streaming squawk box commentary on FUTURESmag.com coming directly from the S&P trading pits in Chicago.