E-mini S&P 500 Index (ES) Futures Technical Analysis – Major Retracement Zone at 2652.50 – 2763.50

June E-mini S&P 500 Index futures settled higher on Monday as President Donald Trump followed last week’s massive fiscal stimulus package by extending his stay-at-home guidelines, leaving investors hopeful the economic impact of the coronavirus could still be contained.

A record $2.2 trillion in aid and policy easing from the Federal Reserve helped equities recover some of their losses last week, with the cash S&P 500 Index posting its biggest weekly percentage gain in over a decade and the Dow Jones its best since 1938.

On Monday, June E-mini S&P 500 Index futures closed at 2611.25, up 87.25 or +3.34%.

Daily Technical Analysis

The main trend is down according to the daily swing chart. However, momentum is trending higher. The main trend will change to up on a trade through 3131.00. A move through 2174.00 will signal a resumption of the downtrend.

The minor trend is up. This is controlling the momentum. A move through the minor top at 2634.50 will indicate the buying is getting stronger.

The short-term range is 3131.00 to 2174.00. Its retracement zone at 2652.50 to 2765.50 is the next upside target.

The minor range is 2174.00 to 2634.50. Its retracement zone at 2404.25 to 2350.00 is the nearest downside target area.

Short-Term Outlook

The direction if the June E-mini S&P 500 Index this week will be determined by trader response to the retracement zone at 2652.50 to 2765.50.

The market is going through a very standard chart pattern, and over the short-run, we’re going to find out who wants it more. Since the main trend is down, sellers re likely to come to defend 26252.50 to 2765.50. Aggressive counter-trend buyers will try to overcome these sellers and make a move toward changing the trend to up.

The second most important area is the retracement zone at 2404.25 to 2350.00. Aggressive counter-trend buyers are likely to come in on the first test of this area. They are going to try to form a new secondary higher bottom.

If 2350.00 fails then a secondary lower top will form at 2634.50. This could create the momentum needed to challenge the recent bottom at 2174.00.