E-mini S&P 500 Index

E-mini S&P 500 Index (ES) Futures Technical Analysis – October 31, 2018 Forecast

December E-mini S&P 500 Index futures are expected to open higher based on the pre-market trade. The strong upside momentum the past two days has triggered a rally into a major retracement zone. Trader reaction to this zone will determine the near-term direction of the index.

Since the main trend is down, sellers may show up to stop the rally in an effort to form a secondary lower top. Taking out the zone will indicate the buying is getting stronger.

E-mini S&P 500 Index
Daily December E-mini S&P 500 Index

Daily Technical Analysis

The main trend is down according to the daily swing chart. A trade through 2603.00 will signal a resumption of the downtrend. Taking out 2824.25 will change the main trend to up.

The minor trend is up. The minor trend changed to up on a trade through 2707.00. This also shifted momentum to the upside.

The major retracement zone and potential resistance is 2701.75 to 2748.50. Inside this zone is a minor retracement zone at 2713.75 to 2739.75. Watch for sellers on a test of these zone. They are going to try to form a secondary lower top. This zone is very important to the long-term structure of the index.

Daily Technical Forecast

Based on the early price action, the direction of the December E-mini S&P 500 Index on Wednesday is likely to be determined by trader reaction to the major Fibonacci level at 2701.75.

A sustained move over 2710.75 will indicate the presence of buyers. The first target is the minor 50% level at 2713.75. This level is also the trigger point for an acceleration to the upside with the next target a Fib level at 2739.75, a downtrending Gann angle at 2744.25 and a 50% level at 2748.50.

A sustained move under 2710.75 will signal the presence of sellers. This could create the downside momentum needed to challenge the steep uptrending Gann angle at 2667.00.

Crossing under the downtrending Gann angle at 2664.25 will put the index in a bearish position with the next support angle coming in at 2635.00.

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.