E-mini S&P 500 Index (ES) Futures Technical Analysis – Bearish Under 2853.75

June E-mini S&P 500 Index futures are called lower based on the early trade as investors awaited the release of April retail sales figures while tensions between the United States and China escalated.

Monthly retail sales data due out at 12:30 GMT are expected to show a record drop as American consumers largely sheltered in place amid the coronavirus outbreak. April retail sales are expected to plunge 12.3%.

Futures were also under pressure as the Trump administration moves to block semiconductor shipments to Chinese company Huawei. The Commerce Department said it would “strategically target Huawei’s acquisition of semiconductors that are the direct product of certain U.S. software and technology.”

Meanwhile, Hu Xijin, editor-in-chief of Chinese state-run publication Global Times, tweeted on Friday that China would “restrict or investigate” U.S. companies including Qualcomm, Cisco Systems and Apple if the U.S. takes further action to block Huawei’s supply chain.

Shares of semiconductor makers AMD, Nvidia and Skyworks Solutions all fell more than 1% in the premarket. Apple shares slid 2.3% while Cisco and Qualcomm fell 2.2% and 3.7%, respectively.

At 12:29 GMT, June E-mini S&P 500 Index futures are trading 2820.75, down 26.25 or -0.92%.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. The main trend turned down on Thursday when sellers took out the last swing bottom at 2771.00.

A trade through 2760.25 will signal a resumption of the downtrend. A move through 2947.00 will change the main trend to up.

The minor range is 2947.00 to 2760.25. Its 50% level at 2853.75 is resistance. This level stopped the market earlier today.

The main range is 3397.75 to 2174.00. The market is currently trading inside its retracement zone at 2785.75 to 2930.25. This zone is controlling the longer-term direction of the index.

The intermediate range is 3131.00 to 2174.00. Its retracement zone at 2765.50 to 2652.50 is potential support.

Combining the two retracement zones creates a major support cluster at 2785.75 to 2765.50.

Daily Swing Chart Technical Forecast

Based on the early price action and the current price at 2820.75, the direction of the June E-mini S&P 500 Index the rest of the session on Friday is likely to be determined by trader reaction to the pivot at 2853.75.

Bearish Scenario

A sustained move under 2853.75 will indicate the presence of sellers. This could trigger a break into 2785.75, followed by a minor support cluster at 2765.50 to 2760.25.

Look for an acceleration into 2717.25 then 2652.50 if 2760.25 fails as support.

Bullish Scenario

A sustained move over 2853.75 will signal the return of buyers. If this creates enough upside momentum then look for a surge into 2930.25 to 2947.00.