E-mini Russell 2000 Index (TF) Futures Technical Analysis – June 30, 2016 Forecast

September E-mini Russell 2000 Index futures are trading slightly better shortly before the cash market opening. The index is testing the retracement zone that should determine the near-term direction of the market.

The main trend is down according to the daily swing chart.

The short-term range is 1178.30 to 1076.70. Its retracement zone at 1127.50 to 1139.50 was the primary upside target. It is currently being tested. Since the main trend is down, sellers may come in to defend the trend on a test of this zone.

Trader reaction to the zone should determine the near-term direction of the index. A sustained move over 1139.50 will give the market a strong upside bias with 1178.30 the next key target. A sustained move under 1127.50 will give the index a strong downside bias and set up a possible secondary lower top.

Based on Wednesday’s close at 1129.10 and the early price action, the direction of the market today is likely to be determined by trader reaction to the steep uptrending angle at 1124.70.

A sustained move over 1124.70 will indicate the presence of buyers. Holding above the 50% level at 1127.50 will indicate the buying is getting stronger. This could generate enough upside momentum to challenge a downtrending angle at 1138.30 and a short-term Fib at 1139.50.

The Fib level is the trigger point for an acceleration to the upside with the next major angle coming in at 1158.30.

A sustained move under 1124.70 will signal the presence of sellers. The daily chart is open to the downside under this angle with the next target angle coming in at 1100.70.

Watch the price action and read the order flow at 1124.70 today. Trader reaction to this angle will tell us if the buyers are still supporting the market or if sellers are regaining control.