E-mini S&P 500 Index

E-mini S&P 500 Index (ES) Futures Technical Analysis – Rangebound Trade Due to Investor Indecision

September E-mini S&P 500 Index futures finished higher in a choppy trade on Friday, while posting an inside move that typically indicates investor indecision and impending volatility. The tug of war between buyers and sellers was fueled by the bulls hoping for more fiscal stimulus and the bears, trimming long positions because of fears of further business disruptions due to a record rise in COVID-19 cases.

On Friday, September E-mini S&P 500 Index futures settled at 3214.00, up 19.50 or +0.61%.

As far as the index components were concerned, BlackRock Inc, the world’s largest asset manager, rose 3.9% after reporting a jump in quarterly profit as investors poured money into its fixed-income funds and cash management services.

Abbott Laboratories rose 3.2%, lifting the S&P 500 more than any other stock. A 1.7% drop in Boeing helped limit gains.

The S&P 500 posted 37 new 52-week highs and no new lows; the NASDAQ Composite recorded 81 new highs and seven new lows.

Daily Swing Chart Technical Analysis

Main Trend Technical Analysis

The main trend is up according to the daily swing chart. A trade through 3233.25 will signal a resumption of the uptrend. This could lead to a prolonged rally in terms of price and time since there is no resistance until the February 20 main top at 3396.50.

The main trend will change to down on a trade through 3105.25. This is also a potential trigger point for a prolonged move to the downside since the next support is at 2983.50.

Minor Trend Technical Analysis

The minor trend is also up. This is also controlling the upside momentum. A trade through 3233.25 will reaffirm the uptrend. The minor trend changes to down on a more through 3119.00. This will also shift momentum to the downside.

If 3233.25 is taken out then 3188.50 will become a new minor bottom.

Retracement Level Technical Analysis

The minor range is 3105.25 to 3233.25. Its 50% level at 3169.25 is the nearest support.

The short-term range is 2983.50 to 3233.25. Its retracement zone at 3108.25 to 3079.00 is potential support, but also a possible trigger point for an acceleration to the downside.

Short-Term Outlook

The divergence between the technology-based NASDAQ Composite and the benchmark S&P 500 Index should be of some concern at the start of the week since technology stocks have been the primary driver of the rally since March 23. Weakness in the technology stocks could be a drag on the S&P Technology sector. That could limit gains in the overall index.

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.