E-mini S&P 500 Index (ES) Futures Technical Analysis – Forming Potentially Bearish Reversal Top

June E-mini S&P 500 Index futures are expected to open lower based on the premarket trade on Thursday. Another dire weekly unemployment report is behind the selling pressure as the news offset strong earnings reports from major technology companies.

The Labor Department said another 3.84 million Americans filed for unemployment benefits last week, bringing the six-week total to more than 30 million. Meanwhile, both Facebook and Microsoft reported promising revenue figures despite the global coronavirus outbreak.

At 13:17 GMT, June E-mini S&P 500 Index futures are trading 2909.50, down 31.50 or -1.07%.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart, however, momentum may be shifting to the downside with the formation of an intraday closing price reversal top.

A trade through today’s intraday high at 2965.00 will signal a resumption of the uptrend. A move through the last swing bottom at 2717.25 will change the main trend to down.

The main range is 3397.75 to 2174.00. Its retracement zone is 2785.75 to 2930.25. This zone is controlling the longer-term direction of the index. The market opened on the strong side of this retracement zone on Thursday, but is now trading inside it.

The intermediate range is 3131.00 to 3174.00. Its retracement zone at 2765.50 to 2652.50 is the next potential downside target zone.

Daily Swing Chart Technical Forecast

Based on the early price action and the current price at 2909.50, the direction of the June E-mini S&P 500 Index the rest of the session on Thursday is likely to be determined by trader reaction to yesterday’s close at 2941.00.

Bearish Scenario

A sustained move under 2941.00 will indicate the presence of sellers. Crossing to the weak side of the Fibonacci level at 2930.25 will indicate the selling pressure is getting stronger. If this creates enough downside momentum then look for a possible break into the support cluster at 2785.75 to 2765.50.

Bullish Scenario

A sustained move over 2941.00 will signal the return of buyers. This could lead to a retest of the intraday high at 2965.00.

Side Notes

The market is up 7 days from the last main bottom which puts it inside the window of time for a closing price reversal top. The chart pattern doesn’t change the trend to down, but if confirmed then look for the start of a 2 to 3 day correction.