E-mini S&P 500 Index (ES) Futures Technical Analysis – Close Below 3132.75 Forms Potentially Bearish Closing Price Reversal Top

December E-mini S&P 500 Index futures are expected to open little changed on Tuesday after retreating from a record high, reached earlier in the session. The price action suggests investors may be shutting down early ahead of the U.S. Thanksgiving holiday on Thursday.

Trading volume may be well-below average, but investor optimism around the U.S.-China trade talks is on the rise. Helping to fuel the early bullish tone was an upbeat comment from China’s ministry of commerce after it was reported that the leaders of China and the U.S. spoke over the phone.

“Both sides discussed resolving core issues of common concern, reached consensus on how to resolve related problems (and) agreed to stay in contact over remaining issues for a phase one agreement,” the Chinese-language statement said, according to a CNBC translation.

At 14:31 GMT, December E-mini S&P 500 Index futures are trading 3131.00, down 2.25 or -0.08%.

Daily Technical Analysis

The main trend is up according to the daily swing chart. The uptrend was reaffirmed earlier in the session when buyers took out yesterday’s high at 3133.50. A trade through today’s intraday high at 3145.00 will signal a resumption of the uptrend.

The main trend will change to down on a move through the last swing bottom at 3020.25. This is highly unlikely, but due to the prolonged move up in terms of price and time, the index is inside the window of time for a closing price reversal top.

This chart pattern won’t change the main trend to down, but it could trigger the start of a 2 to 3 day correction.

The first minor range is 3090.75 to 3145.00. Its pivot at 3117.75 is the first downside target.

The next minor pivot target level is 3110.25. A third minor pivot target is 3104.00.

Daily Technical Forecast

Based on the early price action and the current price at 3131.00, the direction of the December E-mini S&P 500 Index the rest of the session on Tuesday is likely to be determined by trader reaction to Monday’s close at 3132.75.

Bullish Scenario

A sustained move over 3132.75 will indicate the presence of buyers. If this creates enough upside momentum then look for a possible retest of the intraday high at 3145.00. Overtaking this level and the uptrending Gann angle 3145.75 will put the index in a bullish position.

Bearish Scenario

A sustained move under 3132.75 will signal the presence of sellers. If this generates enough downside momentum then look for a possible break into the first pivot at 3117.75. If this level fails then look for the selling to possibly extend into the other pivots at 3110.25 and 3104.00.

The major support angle comes in at 3092.25.