E-mini S&P 500 Index (ES) Futures Technical Analysis – Main Trend Up, Momentum Trending Lower

March E-mini S&P 500 Index futures are trading lower shortly after the cash market opening on Thursday, pressured by a jump in weekly jobless claims which suggested a stalling recovery in the labor market, while losses remained limited by expectations for fresh economic stimulus.

At 15:05 GMT, March E-mini S&P 500 Index futures are trading 3662.75, down 1.50 or -0.04%.

The pace of weekly jobless claims jumped last week after filings caught up with a decline due in part to the Thanksgiving holiday.

First-time claims for unemployment insurance totaled 853,000, an increase from the upwardly revised 716,000 total a week before, the Labor Department reported Thursday. Economists surveyed by Dow Jones had been expecting 730,000.

A separate economic report Thursday indicated that inflation pressures remain tame.

The Consumer Price Index increased 0.2% in November after being unchanged in October. Wall Street had been expecting a monthly increase of 0.1%. For the 12-month period, CPI was up 1.2%, compared to the 1.1% estimate.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart, however, momentum is trending lower. A trade through 3707.00 will signal a resumption of the uptrend. The main trend will change to down on a trade through 3216.25.

The minor trend is down. This is controlling the momentum. Today’s confirmation of Wednesday’s closing price reversal top is also tipping momentum to the downside.

The first minor range is 3583.25 to 3707.00. Its 50% level at 3645.25 is currently being tested.

The second minor range is 3534.00 to 3707.00. Its 50% level at 3620.50 is additional support.

The third minor range is 3497.25 to 3707.00. Its 50% level at 3602.00 is another potential downside target.

Daily Swing Chart Technical Forecast

The early price action on Thursday suggests the direction of the market will be determined by trader reaction to 3645.25.

Bullish Scenario

A sustained move over 3645.25 will indicate the presence of buyers. The first target is a minor level at 3671.50. Overtaking this price could drive the index into 3707.00.

Bearish Scenario

A sustained move under 3645.25 will signal the presence of sellers. This could lead to a labored break with potential support levels coming in at 3620.50 and 3602.00.

The minor 50% level at 3602.00 is a potential trigger point for an acceleration to the downside.