E-mini S&P 500 Index (ES) Futures Technical Analysis – Choppy Trade Fueled by Series of Retracement Levels

March E-mini S&P 500 Index futures are trading lower late in the session on Friday, putting it in a position to post its third straight loss. The benchmark is also going to post its first weekly decline in three weeks.

Friday’s move came as negotiations over a coronavirus relief deal dragged on. Lawmakers seek to pass a bill before the end of 2020, but disagreements over state and local stimulus, unemployment assistance and stimulus checks still exist.

At 21:36 GMT, March E-mini S&P 500 Index futures are trading 3652.75, down 8.00 or -0.22%.

Sentiment was downbeat on Friday even as a key Food and Drug Administration advisory panel recommended the approval of Pfizer and BioNTech’s coronavirus vaccine for emergency use.

Bucking the negative trend was Disney. On Thursday, the company said its Disney+ service has 86.8 million subscribers and expects have between 230 million to 260 million subscribers by 2024. The stock rose 13.6% on Friday.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart, however, momentum has been trending lower since the formation of the closing price reversal top on December 9.

A trade through 3707.00 will negate the closing price reversal top and signal a resumption of the uptrend. The main trend will change to down on a trade through 3216.25.

The minor trend is also down. It changed to down on Thursday. This confirmed the shift in momentum.

The index is currently bouncing inside a number of minor retracement levels that are helping to produce a choppy, two-sided trade.

On the upside, the 50% level at 3664.00 is potential resistance.

On the downside, the 50% levels at 3645.25, 3620.50 and 3602.00 are potential support levels. The latter is a potential trigger point for an acceleration to the downside.

Short-Term Outlook

The near-term direction of the index is likely to be determined by trader reaction to a 50% level at 3664.00 and a 50% level at 3645.25.

Bullish Scenario

A sustained move over 3664.00 will indicate the presence of buyers. If this creates enough upside momentum then look for the rally to possibly extend into the main top at 3707.00. This is a potential trigger point for an acceleration to the upside.

Bearish Scenario

A sustained move under 3664.00 will signal the presence of sellers. This could lead to a labored break into a series of 50% levels at 3645.25, 3620.50 and 3602.00.

Taking out 3602.00 could trigger an acceleration to the downside.