E-mini S&P 500 Index (ES) Futures Technical Analysis – May 2, 2016 Forecast

June E-mini S&P 500 Index futures are trading higher shortly before the cash market opening. The market found support on Friday and early in the session off of a major retracement zone.

 

The main trend is down according to the daily swing chart. The trend turned down late last week when the swing bottom at 2071.00 was taken out.

The main range is 2012.25 to 2105.25. Its retracement zone is 2058.75 to 2047.75. This is the key support area. On April 29, the index tested the lower or Fibonacci level at 2047.75. Earlier today, it tested the upper or 50% level at 2058.75.

Based on Friday’s close at 2059.00 and the earlier price action, the direction of the index today is likely to be determined by trader reaction to the 50% level at 2058.75.

A sustained move under 2058.75 will signal the presence of sellers. The next downside target is the Fib level at 2047.75. This is followed by an uptrending angle at 2038.25.

A sustained move over 2058.75 will indicate the presence of buyers. The first target is a price cluster at 2062.25 and 2078.25. Overtaking 2078.25 could create enough upside momentum to challenge a pair of downtrending angles at 2073.25 and 2078.25.

Watch the price action and read the order flow at 2058.75. This will tell us if the selling is getting stronger or weaker and if aggressive counter-trend buyers are coming in.