E-mini S&P 500 Index (ES) Futures Technical Analysis – Will Turn Lower for Week Under 4536.50

December E-mini S&P 500 Index futures are trading lower late in the session on Wednesday. The technology sector, boosted by gains in Microsoft and Google-parent Alphabet provided some support, but not enough to overcome a drop in oil prices and a pullback in Treasury yields, which weighed on cyclical sectors.

At 19:41 GMT, December E-mini S&P 500 Index futures are at 4557.00, down 8.25 or -0.18%.

A pullback in longer-term U.S. Treasury bond yields and a flattening of the yield curve also helped support growth names such as those in tech and communications services, which were the only advancing S&P sectors on the day, along with consumer discretionary.

The flattening yield curve weakened financials, while a drop in crude prices after a bearish government inventories report, weighed on energy stocks. JP Morgan shares lost 1.91% and Exxon Mobil declined 2.36%.

Daily December E-mini S&P 500 Index

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. A trade through 4590.00 will signal a resumption of the uptrend. A change in trend is highly unlikely, but there is room to the downside for a sizable correction.

The minor trend is also up, but a new minor top has formed at 4590.00.

The minor range is 4522.50 to 4590.00. The index is straddling its pivot at 4556.25 late in the session.

The next minor range is 4317.25 to 4590.00. If the selling pressure continues into the close or early Thursday then its pivot at 4453.50 will become the next downside target price.

Short-Term Outlook

The direction of the December E-mini S&P 500 Index into the close and early Thursday will be determined by trader reaction to 4556.25.

Bearish Scenario

A sustained move under 4556.25 will indicate the selling pressure is getting stronger. This could trigger a break into last week’s close at 4536.50.

Taking out 4536.50 will put the index lower for the week, setting up a possible weekly closing price reversal top. A trade through 4522.50 will make a new low for the week. We could start to see an acceleration to the downside with 4453.50 the next target.

Bullish Scenario

A sustained move over 4556.25 will signal the presence of buyers. If this move can generate enough upside momentum then look for the rally to possibly extend into 4590.00.

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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.