E-mini S&P 500 Index (ES) Futures Technical Analysis – Divergence from Cash Index Bearish Signal

March E-mini S&P 500 Index futures are trading higher on Thursday, but diverging from the cash market index which hit an all-time higher shortly after the opening. The benchmark index is also diverging from the cash and futures Dow Jones Industrial Average and NASDAQ Composite. In 2019, the S&P 500 Index booked a 28.9% gain.

At 15:36 GMT, March E-mini S&P 500 Index futures are trading 3239.25, up 8.25 or +0.26%.

Daily Technical Analysis

The main trend is up according to the daily swing chart. However, upside momentum has slowed since the index formed a closing price reversal top on December 27.

A trade through 3254.00 will negate the closing price reversal top and signal a resumption of the uptrend. The main trend will change to down on a move through the last main bottom at 3071.00. This is highly unlikely, but there is room for a 50% to 61.8% correction.

The minor trend is down. It turned down last week when sellers took out 3222.50. This move confirmed the shift in momentum to down. The new minor bottom is 3213.00. A trade through this bottom will indicate the selling pressure is getting stronger.

The first minor range is 3254.00 to 3213.00. Its 50% level at 3233.50 is controlling the direction of the index today.

The second minor range is 3192.00 to 3254.00. Its 50% level at 3223.00 is the next downside target.

The third minor range is 3118.25 to 3254.00. Its 50% level at 3186.00 is another downside target.

Daily Technical Forecast

Based on the early price action, the direction of the March E-mini S&P 500 Index the rest of the session on Thursday is likely to be determined by trader reaction to the pivot at 3233.50.

Bullish Scenario

A sustained move over 3233.50 will indicate the presence of buyers. The next rally is likely to be labored, however, with potential resistance angles coming in at 3238.25, 3242.00, 3248.00 and 3251.00. The latter is the last potential resistance angle before the 3254.00 main top.

Bearish Scenario

A sustained move under 3233.50 will signal the presence of sellers. The first target is an uptrending Gann angle at 3231.00. This is followed closely by a downtrending Gann angle at 3230.00.

Crossing to the weak side of the downtrending Gann angle at 3230.00 will indicate the selling is getting stronger. This could trigger a break into 3223.00.

If 3223.00 fails then look for the selling to possibly extend into 3213.00. This level is a potential trigger point for an acceleration to the downside.