Breakout Over 4270.50 Will Put E-mini S&P on Path to 4336.50

June E-mini S&P 500 Index futures are inching higher early Friday as investors continue to assess the looming uncertainties surrounding Russia’s invasion of Ukraine which helped drive the benchmark sharply lower the previous session.

Investors are also weighing the potential impact of next week’s U.S. Federal Reserve interest rate hike, the chances of which were cemented on Thursday after the U.S. reported consumer inflation had reached a four-decade high.

At 09:01 GMT, June E-mini S&P 500 Index futures are trading 4249.50, up 1.50 or 0.04%. On Thursday, the S&P 500 Trust ETF (SPY) settled at $425.48, down $1.93 or -0.45%.

Consumer prices surged in February to a 7.9% annual growth rate, according to the Labor Department, the hottest reading in forty years.

While the market fully expects the central bank to raise the Fed funds target rate by 25 basis points at the conclusion of next week’s monetary policy meeting, the CPI data suggested the FOMC could move “more aggressively” to curb inflation in the upcoming year, as promised by Fed Chair Jerome Powell last week.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. A trade through 4094.25 will reaffirm the downtrend. A move through 4410.50 will change the main trend to up.

The minor range is 4410.50 to 4130.25. Its 50% level at 4270.50 is resistance. This level has stopped the market for four consecutive sessions.

The short-term range is 4578.50 to 4094.25. Its retracement zone at 4336.75 to 4393.50 is the next target zone and potential resistance area.

The main range is 4800.00 to 4094.25. If the main trend changes to up then its retracement zone at 4447.25 to 4530.50 will become the primary target and resistance area.

Daily Swing Chart Technical Forecast

The direction of the June E-mini S&P 500 Index on Friday is likely to be determined by trader reaction to the minor pivot at 4270.50.

Bearish Scenario

A sustained move under 4270.50 will indicate the presence of sellers. If this creates enough downside momentum then look for a retest of the minor bottom at 4130.25, followed by the main bottom at 4094.25.

Bullish Scenario

A sustained move over 4270.50 will signal the presence of buyers. If this generates enough upside momentum then look for the rally to possibly extend into 4336.50 to 4393.50. Since the main trend is down, sellers are likely to come in on the first test of this area. They will also be defending the main top at 4410.50.