S&P 500 E-Mini: All-Time High Retest Stalls as Bulls and Bears Face Off

Market Overview: S&P 500 Emini Futures

The market formed an retest all-time high this week. The bulls must create a strong breakout with follow-through buying to increase the odds of the trend resuming. The bears want a reversal from a double top (Jul 16 and Sep 19) and a higher high major trend reversal. If the market trades higher, they want a failed breakout above the July 16 high.

S&P 500 E-Mini Futures

The Weekly S&P 500 E-Mini Chart

• This week’s E-Mini candlestick was a bull bar closing in its upper half with a prominent tail above.
• Last week, we said that the odds slightly favor the market to trade at least a little higher. Traders will see if the bulls can create a retest and breakout above the August 30 high or if the market would trade slightly higher but stall around the August 30 high area instead.
• The bulls made a new all-time high this week but the market closed below the July 16 high.
• They hope the market is in the broad bull channel phase and want a resumption of the move.
• They must create a strong breakout with follow-through buying to increase the odds of the trend resuming.
• If the market trades lower, they want the 20-week EMA or the bull trend line to act as support, forming a double bottom bull flag with the September 6 low.
• The bears see the current rally as a retest of the prior all-time high.
• They want a reversal from a double top (Jul 16 and Sep 19) and a higher high major trend reversal.
• If the market trades higher, they want a failed breakout above the July 16 high.
• They need to create a few strong bear bars to indicate that they are back in control.
• Since this week’s candlestick is a bull bar closing in its upper half with a prominent tail above, it is a buy signal bar albeit weaker.
• Odds slightly favor the market to still be in the sideways to up phase.
• Traders will see if the bulls can create a breakout into new all-time high territory with follow-through buying.
• Or will the market stall around the July high area forming some bear bars in the weeks ahead instead?

The Daily S&P 500 E-Mini Chart

• The market traded slightly higher in the first half of the week but stalled around the August 30 high area. Thursday gapped up making a new all-time high. Friday was a small pullback.
• Last week, we said the market may still trade a little higher. Traders will see if the bulls can create a strong retest of the August 30 high followed by a breakout above or will the market trade slightly higher but stall around the August 30 high area and reverse lower in the weeks ahead instead?
• The bulls hope the rally is in a broad bull channel phase and want a resumption of the move.
• The move up since the September 11 low is in a tight bull channel which means persistent buying.
• They want a strong breakout above the all-time high with follow-through buying.
• If the market trades lower, they want a reversal from a double bottom bull flag with the September 6 low.
• They want the 20-day EMA or the bull trend line to act as support.
• The bears see the current rally as a retest of the all-time high.
• They want a reversal from a higher high major trend reversal and a double top with the prior all-time high (Jul 16).
• They need to create consecutive bear bars closing near their lows trading far below the 20-day EMA to show they are back in control.
• For now, the odds slightly favor the market to still be in the sideways to up phase (at least in the first half of next week).
• Traders will see if the bulls can create a strong breakout above the September 19 high with follow-through buying.
• Or will the market trade slightly higher but stall around the September 19 high area and reverse lower in the weeks ahead instead?