E-mini S&P 500 Index Up

E-mini S&P 500 Index (ES) Futures Technical Analysis – Chart Pattern Indicates Heightened Volatility

September E-mini S&P 500 Index futures finished higher after clawing back earlier losses in what proved to be a very volatile trading session. Stocks opened higher then fell to their lows of the session as concerns about the economic damage from the COVID-19 pandemic replaced early bullishness from stunning quarterly earnings reports by Apple, Amazon.com and Facebook. However, the market managed to recapture those losses into the futures market close despite a lower cash market close.

On Friday, September E-mini S&P 500 Index futures settled at 3269.50, up 20.75 or +0.63%.

The S&P Technology Sector, a major component of the overall index, was boosted by a strong performance in shares of all three tech heavyweights.

Apple Inc shared surged to reach a record high in the wake of blowout quarterly earnings results and a four-for one stock split announcement.

Amazon.com Inc jumped after posting the biggest profit in its 26-year history, while Facebook Inc gained after it reported better-than-expected revenue.

Google-parent Alphabet Inc, on the other hand, fell as quarterly sales dipped for the first time in its 16 years as a public company.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. The uptrend was reaffirmed on Thursday, but the rally fizzled earlier today after an attempted breakout over 3269.00 failed to attract enough buyers to extend the move. Late in the session, however, the index managed to reaffirm the uptrend.

The main trend will change to down on a trade through 3195.00, but were not likely to see an acceleration to the downside unless the selling is strong enough to talk out the next main bottom at 3191.50.

The short-term range is 3284.50 – 3191.50. Its 50% level at 3238.00 appears to be controlling the near-term direction of the index. Traders straddled this price level four times this week as they tried to establish direction.

The short-term range is 3105.25 to 3284.50. Its retracement zone at 3194.75 to 3173.75 is support. It has been propping up the index since July 15.

The main range is 2923.75 to 3284.50. Its retracement zone at 3104.00 to 3061.50 is another potential support zone.

Short-Term Outlook

Based on this week’s price action, it looks like we are likely to experience a volatile trade next week because of the tight trading range. Traders don’t like to see the same prices every day. They want movement and action.

A volatile breakout to the upside could start on a sustained move over 3238.00. Other potential trigger points for an acceleration to the upside are 3273.75 and 3284.50.

On the downside, crossing to the weak side of the short-term Fibonacci level at 3173.75 is likely to draw in the short-sellers. Also contributing to a potential acceleration to the downside will be sell stops placed under 3173.75.

If traders hit this level with selling conviction then don’t be surprised by an acceleration to the downside with the first target a support cluster at 3105.25 to 3104.00.

For a look at all of today’s economic events, check out our economic calendar.

Published by

James Hyerczyk

James A. Hyerczyk has worked as a fundamental and technical financial market analyst since 1982. His technical work features the pattern, price and time analysis techniques of W.D. Gann.