Article #4 Forecasting the S&P500 emini 60min chart

This discussion is a forecast review for Monday June 8, 2015. The MarketWarrior 5 program can make a one week forecast on the 60 minute chart for the S&P500 emini. I am using the DTN IQFeed symbol @ES# which is the continuous nearby symbol for the emini.

The MarketWarrior forecast on the 60 minute chart is a 1 week forecast from Monday to Friday. This means the forecast must be recalculated on Monday because an old forecast will have ended on the previous Friday. I usually recalculate the forecasts at 7:00 AM or 8:00 AM before the main trading session opens. This Monday on June 8, 2015, I calculated the forecast during the 8:00 AM hour. The forecast, as it appeared when it was calculated, is shown below. I have drawn a red box around Monday June 8, because this is the focus of the forecast at this time. The other days, Tuesday to Friday may end up being recalculated so I have pixelated out their forecast times.

The current version of the automatic forecast does not label small Change-In-Trend (CIT) times and that is all there were in the forecast for June 8. This labeling issue has been corrected in the next program release. So I have manually labeled the forecast top at 10:00 AM and a forecast bottom at 3:00 PM and a forecast bottom at 1:00 AM the next day June 9. These are the three relevant CITs with which we are concerned because I may recalculate the forecast before the S&P500’s main trading session opens tomorrow. This forecast shows there should be a decline in the S&P500 emini between 10:00 AM ET and 3:00 PM ET. This forecast also indicates the price change should not be a big move. The next chart shows what happened.


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The picture below was taken during the 10:00 PM hour June 8, 2015. This picture shows the same forecast as seen above. The picture below shows there was a decline in the S&P500 emini between 8:00 AM ET and 4:00 PM ET. This shows the S&P500 on June 8 followed the forecast pattern fairly closely. When using this automatic forecast, you can not expect the market to hit the exact time and price in the forecast but the tops and bottoms should at least be close to the times in the forecast.

The proper way to use this forecast is to review the accuracy of the forecast at least once a day. If the S&P500 emini is following the forecast, you should not recalculate. If you see the S&P500 emini is not following the forecast, then you should recalculate. In this situation the forecast looks very good at the current time, but I will review the forecast on June 9 before the main trading session opens at 9:30 AM ET and I will make a decision to keep the same forecast or recalculate. MarketWarrior 5 makes an automatic forecast for the S&P500 emini (ES) on the 60 minute chart and the 5 minute chart. I will try to post reviews for a mix of the 5 and 60 minute forecasts.


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