E-mini S&P 500 Index (ES) Futures Technical Analysis – Extremely Bullish Over 2524.00, Turns Bearish Under 2494.00

December E-mini S&P 500 Index futures closed higher last week, but a late in the week sell-off nearly put it lower for the week. This would have formed a potentially bearish closing price reversal top. As it stands, it may be indicating that the selling is greater than the buying at current price levels.

Weekly Technical Analysis

The main trend is up according to the weekly swing chart. A trade through 2507.25 will signal a resumption of the uptrend. A break back below the old top at 2486.25 will indicate the selling is greater than the buying at current price levels and it will trap those investors who went long on the breakout over this price. This could prove to be significant later if these buyers are forced to liquidate their positions.

Given the prolonged move up in terms of price and time, the market could take out 2507.25 and zoom to the upside without looking back, sellers could come in and prevent buyers from taking out 2507.25. If they take out 2492.00 then a new minor top will form. Finally, weak buyers can take out 2507.25, but then the rally could fail, leading to a lower close on the weekly chart, or a closing price reversal top.

Weekly Forecast

The swing chart uptrend is not likely to be threatened unless sellers drive the market through 2414.00.

The trend is also being supported by an uptrending Gann angle at 2494.00 this week. It has been guiding the market higher for four weeks. We should see a technical bounce on the first test of this angle, but if it fails then look for an acceleration into the next uptrending angle at 2454.00.

On the upside, taking out last week’s high at 2507.25 could trigger a breakout into a long-term uptrending angle at 2524.00. Overtaking this angle will put the index in an extremely bullish position.