E-mini S&P 500 Index

E-mini S&P 500 Index (ES) Futures Technical Analysis – Needs to Hold 4225.25 to Sustain Upside Momentum

June E-mini S&P 500 Index futures are inching higher during the pre-market session on Monday on light trading. The benchmark index hit another record high as investors continued to react to Friday’s weaker-than-expected U.S. jobs report that drove Treasury yields sharply lower while dampening the need for early tightening by the Federal Reserve. Helping to put a lid on prices are concerns over a fuel pipeline cyberattack.

At 02:54 GMT, June E-mini S&P 500 Index futures are trading 4235.00, up 9.75 or +0.23%.

A ransomware attack forced the closure of the largest U.S. fuel pipeline over the weekend, Reuters reported. Colonial Pipeline, which operates a 5,500-mile system, said it was forced to halt the transport of fuel from the Gulf Coast to the New York metro area on Friday as it “took certain systems offline to contain the threat.”

The ultimate impact of the attack on fuel prices remains unclear, and analysts say the length of the shutdown will have the greatest impact. This event could add to the volatility in the energy sector.

Daily June E-mini S&P 500 Index

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. The uptrend resumed earlier in the session when buyers took out Friday’s high at 4232.25. A trade through the intraday high at 4238.25 will reaffirm the trend. A move through 4120.50 will change the main trend to down.

The new minor range is 4120.50 to 4238.25. Its 50% level or pivot at 4179.25 is new support. This level will move higher as the index rises.

The short-term range is 3843.25 to 4238.25. If the main trend changes to down then its retracement zone at 4040.75 to 3994.00 will become the primary target zone. This area will also move up along with the index.

Daily Swing Chart Technical Analysis

The direction of the June E-mini S&P 500 Index on Monday is likely to be determined by trader reaction to 4225.25.

Bullish Scenario

A sustained move over 4225.25 will indicate the presence of buyers. Taking out the intraday high at 4238.25 will indicate the buying is getting stronger. If the buying volume is strong enough then we could see a possible acceleration to the upside.

Bearish Scenario

A sustained move under 4225.25 will signal the presence of sellers. This will also put the index in a position to form a potentially bearish closing price reversal top. If the move creates enough downside momentum then look for the selling to possibly extend into the minor pivot at 4179.25.

Since the main trend is up, buyers could come in on the first test of 4179.25. If this level fails then look for an acceleration to the downside with 4120.50 the next likely downside target.

Side Notes

A close under 4225.25 will form a closing price reversal top. If confirmed, this could lead to trigger the start of a 2 to 3 day correction.

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.