E-mini S&P 500 Index (ES) Futures Technical Analysis – August 11, 2017 Forecast

September E-mini S&P 500 Index futures are trading lower during the pre-market session. The market is still under pressure from the U.S. – North Korea situation. There is no new develops. As far as we know, North Korea is still threatening to fire ballistic missiles at Guam and the U.S. is ready to protect its interests.

I’m sure there are diplomatic negotiations going on to diffuse this matter, but until then the market appears to be thinking its “peace” or nothing. Investors are taking both threats seriously and slashing positions.

Today, the U.S. will release its latest consumer inflation data. Traders are looking for CPI and Core CPI to come in at 0.2%. A lower than expected number may reduce the chances of a Fed rate hike later this year. This is theoretically bullish for stocks so we could see a technical bounce.

The question that needs to be answered is whether investors will increase selling into the close as protection against a major event taking place over the week-end.

Technical Analysis

The main trend is up according to the daily swing chart. However, momentum has been down since the formation of the closing price reversal top on August 8 at 2488.50.

The main range is 2402.25 to 2488.50. Its retracement zone is 2445.25 to 2433.25. This zone was the primary downside objective of the closing price reversal top. It looks like the selling pressure has overshot the zone.

Forecast

Based on the early trade, the direction of the index is going to be determined by trader reaction to the Fibonacci level at 2435.25.

A sustained move under 2435.25 will indicate the presence of sellers. The first target is the uptrending Gann angle at 2432.25. The daily chart opens up to the downside under this angle with potential target angles coming in at 2417.25 and 2409.75. The latter is the last potential support angle before the 2402.25 main bottom.

A sustained move over 2435.25 will indicate the return of buyers. Overcoming the steep downtrending angle at 2440.50 will indicate the buying is getting stronger. This could trigger a fast rally into the 50% level at 2445.50.

The daily chart opens up to the upside over 2445.50 with a price cluster at 2462.25 to 2464.50 the primary upside target.

Weekly Chart Analysis

The main range on the weekly chart is 2314.75 to 2488.50. Its retracement zone at 2401.25 to 2381.00 is another major downside target. An uptrending angle at 2390.75 passes through this zone, making it a valid downside target also.