E-mini S&P 500 Index (ES) Futures Technical Analysis – Close Under 3121.75 Forms Closing Price Reversal Top

December E-mini S&P 500 Index futures are edging lower shortly after the opening on Tuesday. Earlier in the session, the benchmark index hit a fresh record high, however, those gains evaporated as losses in Home Depot and Kohl’s outweighed gains in Boeing shares. Uncertainty over the progress of U.S.-China trade talks may have also dampened investor sentiment.

At 15:38 GMT, December E-mini S&P 500 Index futures are trading 3119.75, down 2.00 or -0.06%.

Daily Technical Analysis

The main trend is up according to the daily swing chart. The uptrend was reaffirmed earlier on Tuesday when buyers took out yesterday’s high.

The main trend will change to down on a trade through 3020.25. This is highly unlikely. However, due to the prolonged move up in terms of price and time, the index is ripe for a closing price reversal top. This chart pattern won’t change the main trend to down, but if confirmed, it could lead to the start of a 2 to 3 day correction.

The minor trend is also up. A trade through 3075.75 will change the minor trend to down. This will also shift momentum to the downside.

The first minor range is 3075.75 to 3132.50. Its 50% level comes in at 3104.00.

The second minor range is 3063.00 to 3132.50. Its 50% level is at 3097.75.

The main range is 3020.25 to 3132.50. Its retracement zone at 3076.25 to 3063.00 is the first major downside target.

Daily Technical Forecast

Based on the early price action and the current price at 3119.75, 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 3121.75.

Bearish Scenario

A sustained move under 3121.75 will indicate the presence of sellers. This move will put the index in a position to form a potentially bearish daily closing price reversal top.

The market is also trading on the weak side of a pair of uptrending Gann angles at 3119.00 and 3129.25.

If the selling pressure continues through 3119.00 then look for a break into the next uptrending Gann angle at 3105.75, followed by a pair of 50% levels at 3104.00 and 3097.75.

The 50% level at 3097.75 is a potential trigger point for an acceleration to the downside with the next target zone 3076.25 to 3063.00.

Bullish Scenario

A sustained move over 3121.75 will signal the presence of buyers. This could lead to a retest of the intraday high at 3132.50.