E-mini S&P 500 Index (ES) Futures Technical Analysis – Drop in Consumer Confidence Sinks Benchmark Index

September E-mini S&P 500 Index futures are trading lower at the mid-session after erasing earlier gains. Sellers came in following a drop in June U.S. consumer confidence.

Despite the early gains, the buying was tentative as investors were still weighing the impact of soaring inflation and an aggressive push by the U.S. Federal Reserve to raise interest rates to tame inflation.

At 16:57 GMT, September E-mini S&P 500 Index futures are trading 3862.25, down 41.50 or -1.06%. The S&P 500 Trust ETF (SPY) is at $384.48, down $4.11 or -1.06%.

Prices are trading lower after a report showed U.S. consumer confidence fell sharply in June as worries about high inflation left consumers anticipating economic growth would weaken significantly in the second half of the year.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. A trade through 4204.75 will change the main trend to up. A move through 3639.00 will signal a resumption of the downtrend.

The minor trend is also down. It changed to down early in the session when sellers took out the minor bottom at 3892.50. This shifted momentum to the downside.

The short-term range is 4204.75 to 3639.00. Its retracement zone at 3922.00 to 3988.75 is resistance. This area stopped the buying at 3950.00 earlier in the session.

The minor range is 3639.00 to 3950.00. Its retracement zone at 3794.50 to 3757.75 is the primary downside target.

Daily Swing Chart Technical Forecast

Trader reaction to 3903.75 is likely to determine the direction of the September E-mini S&P 500 Index into the close on Tuesday.

Bearish Scenario

A sustained move under 3903.75 will indicate the presence of sellers. If this move creates enough downside momentum then the minor retracement zone at 3794.50 to 3757.75 will become the primary downside target.

Bullish Scenario

A sustained move over 3903.75 will signal the presence of buyers. This could lead to a labored rally with potential upside targets lined up at 3922.00, 3950.00 and 3988.75.

The Fibonacci level at 3988.75 is a potential trigger point for an acceleration to the upside.

Side Notes

A close under 3903.75 will form a closing price reversal top. If confirmed, this could trigger the start of a minimum two day correction with 3794.50 – 3757.75 the next major target area.