Market Overview: S&P 500 Emini Futures
The weekly chart is forming an 8-bar bull microchannel. That means strong bulls. The bulls will need to create follow-through buying following the breakout above the July 27 high. The bears hope the climactic move will lead to a two-legged sideways-to-down pullback.
S&P 500 Emini Futures
![Emini-Weekly Chart Emini-Weekly Chart](https://d1-invdn-com.investing.com/content/pic6be691d91cbe609b22efab4c44f69d43.jpg)
This week’s Emini candlestick was another consecutive bull bar closing in its upper half with a noticeable tail above.
Last week, we said that odds continue to slightly favor the market to still be Always In Long.
This week traded and closed above the July 27 high.
The bulls got a strong rally in the form of an 8-bar bull microchannel with bull bars closing near their highs. That means strong bulls.
The bulls hope to create a short covering spike above the July 27 high. Bears that have covered will likely not sell again until another significant resistance above (probably above the all-time high next).
The next target for the bulls is the all-time high. They want a strong breakout into new all-time high territory, hoping that it will lead to many months of sideways to up trading.
They will need to create follow-through buying next week to increase the odds of a retest of the all-time high.
If a pullback begins, the bulls want it to be sideways and shallow, with doji(s), bull bars and overlapping candlesticks with long tails below.
If there is a deep pullback, they want a reversal up from a higher low major trend reversal and the 20-week EMA to act as support.
The bears hope that the strong move is simply a buy-vacuum test of what they believe to be a 36-month trading range high.
They want a reversal from a higher high major trend reversal (with the July 27 high) or a double top July 27 high.
The problem with the bear’s case is that the current rally is very strong.
They will need to create strong bear bars with sustained follow-through selling to increase the odds of a deeper pullback. So far, they have not yet been able to do so.
Since this week’s candlestick is a bull bar closing in its upper half, it is a buy signal bar for next week. The risk for new buyers is becoming big because of the large stop required.
Swing bulls will likely continue to hold their longs established at a much lower price through the anticipated pullback, expecting any pullback to be minor.
As the trend is becoming increasingly climactic, a small pullback can begin within a few weeks.
However, until the bears can create strong consecutive bear bars, odds continue to favor the market to remain in the sideways to up phase.
Odds also favor buyers below the first pullback from such a strong bull microchannel.
If there is a deeper pullback, odds slightly favor at least a small second leg sideways to up.
Traders will see if the bulls can get another follow-through bull bar (even if it is just a bull doji) or will the market close with a bear body and a prominent tail above, beginning the minor pullback phase.
![Emini-Daily Chart Emini-Daily Chart](https://d1-invdn-com.investing.com/content/picb625f0423a3421ae81ad62d7dfcc80d4.jpg)
The market traded higher for the week. Wednesday traded above the July 27 high with some follow-through buying on Thursday. Friday was a small inside doji.
Last week, we said that the buying pressure remains very strong with bear bars not getting follow-through selling. Odds continue to favor the market to still be Always In Long.
The bulls got a strong reversal with several big gaps that remained open and in a tight bull channel.
They hope that the current rally will form a spike and channel which will last for many months after a pullback.
They want a strong short covering above the July 27 high that will fuel the move towards the all-time high.
They want a strong breakout into new all-time high territory.
If a pullback begins, the bulls want the 20-day EMA to act as support and form a 20-Gap-Bar buy setup.
They want any pullback to be sideways and shallow (with doji(s), overlapping bars, bull bars and candlesticks with long tails below).
The bears hope that the strong rally is simply a buy vacuum retest of the July 27 high.
They want a reversal down from a lower high major trend reversal (against the all-time high) and a double top (with July 27).
The problem for the bears is that the selling pressure remains weak (no consecutive bear bars) while the buying pressure is very strong (strong bull bars closing near their highs).
The bears will need to create consecutive bear bars closing near their lows trading far below the 20-day EMA to increase the odds of a reversal.
For now, the buying pressure remains very strong with bear bars not getting follow-through selling.
While the market is becoming increasingly climactic, until the bears can create strong bear bars, odds slightly favor the market to remain in the sideways to up phase.
The odds slightly favor any pullback to be minor, followed by a retest of the current leg extreme high (now December 14).