E-mini Russell 2000 Index (TF) Futures Technical Analysis – July 26, 2016 Forecast

September E-mini Russell 2000 Index futures are trading nearly flat shortly before the cash market opening. Yesterday, the index formed a closing price reversal top. A trade through 1203.00 will confirm. If this move attracts enough sellers, we could see a 2 to 3 day correction.

The main trend is up according to the daily swing chart. A trade through 1213.40 will negate the closing price reversal top. It will also signal a resumption of the uptrend. A trade through 1194.70 will change the main trend to down.

The short-term range is 1194.70 to 1213.40. Its 50% level or pivot at 1204.00 is controlling the short-term direction of the market. This pivot forms a support cluster with the uptrending angle at 1204.70.

A sustained move under 1204.00 will be the first sign of weakness, but the actual acceleration may take place if 1203.00 is taken out with conviction. We need better than average selling volume to make this work.

The next target under 1203.00 is the main bottom at 1194.70. Taking out this bottom will change the main trend to down with the next target angle coming in at 1181.60.

Holding above 1204.70 will indicate the presence of buyers. This may generate enough upside momentum to challenge the high at 1213.40 and the uptrending angle at 1214.70. Overtaking the angle will put the index in a bullish position with 1224.80 the next major target.

Look for a bullish tone today on a sustained move over 1204.70 and a bearish tone on a sustained move under 1204.00.