E-mini S&P 500 Index (ES) Futures Technical Analysis – August 24, 2016 Forecast

September E-mini S&P 500 Index futures rallied on Tuesday, led by materials stocks which rose nearly 1 percent as investors looked ahead to Federal Reserve Chair Janet Yellen’s speech on Friday. The market was also pushed higher by an unexpected surge in U.S. New Home Sales for July.

Technically, the main trend is up according to the daily swing chart. The index rallied through 2190.75, reaffirming the uptrend, but because of the thin trading conditions, the breakout attempt ended early at 2191.50. The new main bottom is 2165.50. A trade through this level will turn the main trend to down.

The new short-term range is 2165.50 to 2191.50. This makes its 50% or pivot level at 2178.50 a key number to watch. Trader reaction to this level should determine the direction of the index today.

U.S. reports later in the session include Existing Home Sales at 1400 GMT and Crude Oil Inventories at 1430 GMT. Traders expect home sales to fall slightly from 5.57 million units to 5.52 million units.

Based on the low volume and the lack of fresh economic news, we expect the E-mini S&P 500 index to straddle the pivot at 2178.50 most of the session.