Futures, E-Mini S&P 500, June 20th 2014.
Technical Analysis, 5 Minute Chart.
E-futures S and P 500
June 20, 2014
The market opened with a usual fade; this time the pre-market bullish momentum was countered with a Bears' run to the moving average and the low of bar number two. At bar number four, the algorithm probability stated a bullish run in response to the Bears opening fade. During this whole time, market inertia has remained with the Bulls.
The market has entered into a trading range, keeping in mind that inertia remains with the Bulls, this means, we will be looking for trades on the buy side.
In the one-hour chart, a hammer tail denotes a clear signal of resistance.
Bears will look to cover some of their positions to at least the moving average.
The overall price action in the one-hour chart, illustrates clearly that market inertia remains with the Bulls. Thus, for conservative traders, would be to go long in pullbacks as they take place. For more aggressive traders, emphasis should be made to trade on the buy side, using the five-minute chart as the entry timeframe.
In the daily chart, the algorithmic -probability of price action was satisfied for the Bulls and negated for the Bears. Clearly their reaffirmation of the bullish trend under which the market has been for the past six months appears with the potential to challenge the bull channel trendline above. Higher prices appear imminent.
The bar 12 low reached below the bar number four low, not enough selling pressure to declare the market always in short. Moreover, our algorithmic probability denotes buying momentum. The market remains without direction, and in a trading range we always want to buy low sell high and scalp.
Algorithm-probability, whispers a potential bullish run. Remember, the market overall is in a prolonged bullish trend. Aggressive traders could buy below the moving average or at bar 17 for scalps. And choose to wait once the market is above the moving average to see if the Bears breakout to the base of the trading range, which is below the moving average.
Buying energy is clearly incrementing with bars 16 through 18. Bulls will target high of bar number nine. Now that the market is above the moving average, near the target of bar nine high, aggressive bears could attempt to fade once the bar nine high forms the double top with the market. Their target could be to at least the moving average.
Accumulation of buying pressure has been established, with the close of bar 18 above its midpoint. Price action signals a bullish breakout with a very vertical bar 19 close near its high, conservative traders will look to buy a pullback near or at the moving average.
Higher prices appear imminent; bears will not look to short until and after the market makes a double top with today's high of bar 1 at the opening. Bar 21 is clearly on its way. Aggressive bulls could go long with a stop below the bar's 20 low for a swing to the opening’s high of the day.
It also can be stated, that, with the bar's 19 high and close, which surpassed the bar's 9 high, the market is always in long.
With the formation of bar 21, a second leg for the Bulls could be imminent, which, evidence for the bullish case is substantial.
Buyers below, await a possible profit-taking run by the bulls to the moving average.
Algorithm-probability states short run to at least the moving average, where the market will be met with buyers, eager to participate on the bullish inertia.
Aggressive bulls look to buy the low of bar 25. Overall, the market remains in a trading range, in which currently navigates through its middle. As per, algorithmic probability of price action clearly denotes strong buying momentum, conservative traders and swing traders would buy at this point, and look to swing for today's high at the opening; with a stop loss one tick below the bar 25's low.
Profit-taking and aggressive bears created the bar 29 low below bar 25. Take note of the bottom tail in bar 29, which clearly represents an effort by the Bulls to regain directional control of the market. Trading participants await for the closing of Bar 30, and more data to scale in for longs. Hesitation is clearly present during the price action of a trading range market. In such instances buy low sell high and scalp.
Take note of the bottom tail in bar 30, a doji bar, which indicates indecision by the market participants. While keeping in mind, that the Bulls remain with inertia of the market, with this price action, is better to wait for more data.
Bar 32 forms a double bottom with 16 to compose a possible support level. Take note, of the bottom tails during the Bear leg to bar 32, which states the current buy-in participants looking to reengage.
The closing of bar 34 will be important to determine the direction of the market short-term.
The Bulls will run over the moving average. Swing traders could go long at bar 36 with a stop loss one tick below its low.
Market at a trading range, however, a bullish breakout looks imminent. Closer analysis of this trading range reveals a majority for the Bulls to take control of the market.
The 15 minutes chart a triangle formation is evident, a breakout is due any minute; and as per price action analysis.
Market remains in a trading range.
Buying pressure is evident between bars 50 and 53, with prices looking to be higher before the 1430 inflexion time.
In the 15-minute chart, the algorithm-probability of price action, presents a favorable case for the Bulls.
With the close of bar 57 near its high, and as a bull bar, bullish momentum is clearly surpassed the highs of the previous 11 bars. This is a clear sign, that, the Bulls would look to challenge the high of the start of the bear channel back at the 1130 inflection time.
The algorithmic-probability of price action calls for a short and profit-taking at the inflection time of 1430. If this is the case, Buyers at the moving average will meet the short move as a buying opportunity.
This is Inflection time, more over, resistance level by way of a bear channel trend-line.
Algorithmic-probability of price action, denotes, buyers reengage at or just below the moving average. Bar 62, closes as a bull bar, aiding the Bulls case.