E-mini S&P 500 Index (ES) Futures Technical Analysis – Early Trade Shows Reaction to 3926.75 Sets the Tone

June E-mini S&P 500 Index futures are trading slightly lower in the overnight session after the benchmark posted a solid gain during Monday’s regular trading hours. The gains came as the 10-year Treasury yield retreated, after touching a 14-month high last week.

At 02:42 GMT, June E-mini S&P 500 Index futures are at 3926.25, down 3.75 or -0.10%.

Looking ahead. On Tuesday Fed Chairman Jerome Powell and Treasury Secretary Janet Yellen will make their first joint appearance before the U.S. House Committee on Financial Services. The discussion will center on the oversight of the Treasury’s and Federal Reserve’s pandemic response.

In prepared remarks published ahead of the hearing, Powell noted that the recovery is gaining steam, before adding there’s still a long way to go.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart, however, momentum has been trending lower since the formation of the closing price reversal top on March 18.

A trade through 3978.50 will negate the closing price reversal top and signal a resumption of the uptrend. The main trend changes to down on a move through 3710.50.

The minor trend is down. This confirms the shift in momentum. A trade through the minor bottom at 3875.00 will reaffirm the downtrend.

The minor range is 3978.50 to 3875.00. The index is currently straddling its 50% level at 3926.75.

The short-term range is 3710.50 to 3978.50. Its 50% level at 3844.50 is a potential support level.

The main range is 3648.00 to 3978.50. Its retracement zone at 3813.25 to 3774.25 is the major support. This area is controlling the near-term direction of the index.

Daily Swing Chart Technical Forecast

The early direction of the June E-mini S&P 500 Index is likely to be determined by trader reaction to 3926.75.

Bullish Scenario

A sustained move over 3926.75 will indicate the presence of buyers. If this move is able to create enough upside momentum then look for a possible test of 3978.50 over the near-term.

Bearish Scenario

A sustained move under 3926.75 will signal the presence of sellers. This could create the downside momentum needed to eventually challenge 3875.00.

For a look at all of today’s economic events, check out our economic calendar.