E-mini S&P 500 Index (ES) Futures Technical Analysis – In Position to Post Bearish Reversal Top

June E-mini S&P 500 Index futures are trading lower late Thursday, while clawing back more than 50% of its earlier losses. The market was under pressure from the start as a spike in bond yields fueled fears of equity valuations and caused investors to sell growth-focused high flyers.

At 19:25 GMT, June E-mini S&P 500 Index futures are trading 3912.50, down 51.00 or -1.29%.

Tech shares were under pressure as Apple, Alphabet, Microsoft and Facebook all fell at least 1%. Meanwhile, bank stocks outperformed as higher interest rates tend to improve their profit margins. JPMorgan jumped 2, while Goldman Sachs gained 1.9%. Citizen Financial popped 4% and Zions Bancorp rallied 3.6%.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. The uptrend was reaffirmed earlier today when buyers took out the previous day’s high.

The main trend will change to down on a move through 3710.50. This is highly unlikely but the index is in a position to form a potentially bearish closing price reversal top.

The minor trend is also up. A trade through 3925.00 will change the minor trend to down. This will also shift momentum to the downside.

The minor range is 3925.00 to 3978.50. The index is straddling its pivot at 3951.75 into the close.

The short-term range is 3710.50 to 3978.50. Its 50% level at 3844.50 is the next potential downside target, followed by 3813.25 to 3774.25.

Daily Swing Chart Technical Forecast

The direction of the June E-mini S&P 500 Index into the close on Thursday is likely to be determined by trader reaction to 3951.75.

Bearish Scenario

A sustained move under 3951.75 will indicate the presence of sellers. The first downside target is 3925.00.

Taking out 3925.00 will not only change the minor trend to down, but it could trigger an acceleration to the downside.

Bullish Scenario

A sustained move over 3951.75 will signal the presence of buyers. If this creates enough upside momentum then look for a possible retest of 3978.50.

Side Notes

A close under 3963.50 will form a closing price reversal top on the daily chart. If confirmed, this could trigger the start of a 2 to 3 day counter-trend correction.

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