E-mini S&P 500 Index (ES) Futures Technical Analysis – December 21, 2018 Forecast

March E-mini S&P 500 Index futures are expected to open nearly flat on Friday after posting an inside move during the pre-market session. Nonetheless, the index is expected to finish the week with a steep loss. The benchmark index has been under pressure all week, but especially since Wednesday when the Fed raised its benchmark rate, while maintaining a hawkish tone toward policy.

At 1400 GMT, March E-mini S&P 500 Index futures are trading 2488.25, up 2.00 or +0.08%.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. A trade through 2441.50 will signal a resumption of the downtrend. The nearest main top is 2690.25.

I don’t expect to see a change in trend, but the market is also in the window of time for a closing price reversal bottom. If this chart pattern is formed then it will signal the buying is greater than the selling at current price levels.

The new short-term range is 2690.25 to 2441.50. Its retracement zone at 2566.00 to 2595.50 is the first upside target.

Daily Swing Chart Technical Forecast

Based on the early price action, the direction of the March E-mini S&P 500 Index is likely to be determined by trader reaction to yesterday’s close at 2486.25.

Bullish Scenario

A sustained move over 2486.25 will indicate the presence of buyers. If this move can generate enough short-covering then look for a potential rally into the short-term 50% level at 2566.00.

Bearish Scenario

A sustained move under 2486.25 will signal the return of sellers. They could trigger a retest of yesterday’s low at 2441.50. This is followed closely by the August 25, 2017 main bottom at 2434.50.

Closing Price Reversal Bottom

Taking out 2441.50 then recapturing 2486.25 will put the index in a position to form a closing price reversal bottom. If confirmed, this could trigger the start of a 2 to 3 day counter-trend rally.