E-mini S&P 500 Index (ES) Futures Technical Analysis – August 21, 2018 Forecast

September E-mini S&P 500 Index futures are trading higher shortly before the cash market opening. The chart pattern is fairly simple:  strong buying will either drive the index through 2863.75, or a combination of weak buying and strong selling will drive the index down into the nearest support. So essentially, let’s just say that today’s price action will be driven by momentum.

Daily Technical Analysis

The main trend is up according to the daily swing chart. It was confirmed earlier in the session when buyers took out the previous main top at 2863.75. If buyers continue to come in to support the rally then we should start to pull away or breakout over this top. The daily swing chart indicates there is no resistance until 2889.00.

The market is in no position to change the main trend to down, but if it turns lower for the day on a move under 2858.50 then it will be in a position to post a closing price reversal top. This chart pattern will not indicate a change in trend, but it will signal that the selling is greater than the buying at current price levels. If confirmed, this could lead to a 2 to 3 day correction.

Daily Technical Forecast

We’re watching two levels today, a steep uptrending Gann angle at 2867.00 and yesterday’s close at 2858.50.

Overtaking 2867.00 and sustaining the rally will indicate the presence of buyers. This will put the index in an extremely bullish position. A sustained move over this level will put the index in a position to test its January 29 all-time high at 2889.00 on August 22 or August 23.

The inability to sustain a move over 2889.00 will indicate weak buying. A move under the previous top at 2863.75 will indicate the presence of sellers. A trade under 2858.50 will indicate the selling is getting stronger.

If the selling pressure builds enough downside momentum then we could see a 2 to 3 day correction all the way back to an uptrending Gann angle currently at 2835.00.