E-mini Russell 2000 Index (TF) Futures Technical Analysis – April 27, 2016 Forecast

June E-mini Russell 2000 Index futures closed higher on Tuesday, taking out the previous day’s high in the process and negating the potentially bearish closing price reversal top at 1149.10 in the process.

The index opened lower on Wednesday after Apple released disappointing earnings after the bell on Tuesday. Position-squaring ahead of Wednesday’s Fed policy statement may also be behind the early weakness.

The main trend is up according to the daily swing chart. The trend will turn down on a trade through 1117.60. The market is in no danger of changing the trend to down, but it is in the window of time for a potentially bearish closing price reversal top.

The short-term range is 1117.60 to 1150.00. Its retracement zone at 1133.80 to 1130.00 is the primary downside target. This zone has essentially provided support over the last six sessions. Treat this zone like a pivot. Taking out the lower, or Fibonacci level at 1130.00 could trigger the start of a steep break.

The intermediate range is 1083.50 to 1150.00. Its retracement zone at 1116.75 to 1108.90 is another potential downside target.

Based on Tuesday’s close at 1149.20 and the early price action, the direction of the market today is likely to be determined by trader reaction to the uptrending angle at 1151.50.

A sustained move over 1151.50 will indicate the presence of buyers. The first upside target is another uptrending angle at 1157.20. Crossing to the strong side of this angle will put the index in a bullish position with the December 29, 2015 main top at 1158.60 the next major target.

A sustained move under 1151.50 will signal the presence of sellers. The first downside target is an uptrending angle at 1145.60. This is a trigger point for an acceleration into the next uptrending angle at 1139.50.

The angle at 1139.50 is the trigger point for an acceleration to the downside with the next major target the short-term retracement zone at 1133.80 to 1130.00.

Watch for another acceleration to the downside if 1130.00 is taken out with conviction. The main targets under this level are 1117.60 and 1116.70.

Watch the price action and read the order flow at 1151.50 today. Trader reaction to this angle will tell us if buyers are still coming in to support the rally, or if sellers are taking control.