E-mini S&P 500 Index (ES) Futures Technical Analysis – Close Under 4701.50 Forms Daily Reversal Top

December E-mini S&P 500 Index futures are trading lower late in the session on Friday as fears of new lockdowns to curb the spread of COVID-19 in Europe hammered banking, energy and airline stocks. Losses were limited by strength in the technology sector.

At 18:47 GMT, December E-mini S&P 500 Index futures are trading 4692.50, down 9.00 or -0.19%.

A resurgence in COVID-19 cases saw Austria outline plans for a full lockdown, and fears that Germany could follow suit rattled stock markets globally.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. A trade through the intraday high at 4723.50 will signal a resumption of the uptrend. A move through 4625.25 will change the main trend to down.

The minor trend is also up. A trade through 4668.00 will change the minor trend to down. This will shift momentum to the downside.

The minor range is 4625.25 to 4723.50. Its 50% level at 4674.25 is potential support.

The second minor range is 4543.75 to 4723.50. If the minor trend changes to down then its pivot at 4633.50 will become the next downside target.

Daily Swing Chart Technical Forecast

The direction of the December E-mini S&P 500 Index into the close on Friday will be determined by trader reaction to 4701.50.

Bullish Scenario

A sustained move over 4701.50 will indicate the presence of buyers. If this creates enough upside momentum then look for a test of the intraday high at 4723.50.

Bearish Scenario

A sustained move under 4701.50 will signal the presence of sellers. If this generates enough downside momentum then look for the selling to possibly extend into 4674.25, followed by the minor bottom at 4668.00.

Taking out 4668.00 will shift momentum to the downside. This could trigger an acceleration to the downside with the next target 4633.50, followed by 4625.25.

Side Notes

A close under 4701.50 will form a potentially bearish closing price reversal top. If confirmed, this could trigger the start of a minimum 2 to 3 day correction.