E-mini S&P 500 Index

E-mini S&P 500 Index (ES) Futures Technical Analysis – Testing Major Fibonacci Level at 2701.75

December E-mini S&P 500 Index futures finished sharply lower on Tuesday as investors raised concerns over the trade dispute truce between the United States and China, and an inverted Treasury market which could be an indication of a future economic slowdown.

Volume was well above average with the banking sector suffering the worst of the selling pressure. The U.S. stock market will be closed on Wednesday out of respect for former President George H.W. Bush’s funeral.

On Tuesday, the December E-mini S&P 500 Index settled at 2701.75, down 89.00 or -3.29%.

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

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. A trade through 2626.00 will signal a resumption of the downtrend. This could trigger a further decline into main bottoms at 2603.00 and 2602.75. The main trend will change to up on a move through 2818.00. This is followed by another main top at 2824.25. This is the trigger point for an acceleration to the upside.

The major retracement zone is 2748.50 to 2701.75. The short-term retracement zone is 2775.00 to 2815.50. This makes 2701.75 support and 2748.50, 2775.00 and 2815.50 resistance.

Daily Swing Chart Technical Forecast

Based on Tuesday’s close at 2701.75, the direction of the December E-mini S&P 500 Index when it opens on Thursday will be determined by trader reaction to the main Fibonacci level at 2701.75.

Bullish Scenario

A sustained move over 2701.75 will indicate the presence of buyers. If this generates enough upside momentum then look for the rally to extend into the main 50% level at 2748.50. This is followed by the short-term 50% level at 2775.00.

Bearish Scenario

A sustained move under 2701.75 will signal the presence of sellers. The daily chart indicates the market is wide open to the downside with the next major targets coming in at 2626.00, followed by 2603.00 and 2602.75.

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.