E-mini S&P 500 Index (ES) Futures Technical Analysis – May 22, 2017 Forecast

June E-mini S&P 500 Index futures are called slightly better shortly before the cash market opening. There are no major economic releases today, but investors could react to news from President Donald Trump’s first foreign policy trip to the Middle East.

Traders will also get the opportunity to respond to speeches from several Federal Open Market Committee members. They will be watched for possible comments on Fed policy.  Investors will also be paying close attention to the price action in the crude oil market. Firmer prices could boost the Dow and S&P 500 Index.

Technical Analysis

The main trend is down according to the daily swing chart. However, momentum is trending higher. Holding above the short-term retracement zone at 2381.50 to 2375.50 will continue to support the developing upside bias.

The upside target is the main top at 2404.50. Taking out this level will negate the closing price reversal top and signal a resumption of the uptrend. A trade through 2344.50 will negate the closing price reversal bottom and signal a resumption of the downtrend.

The main range is 2322.75 to 2404.50. Its retracement zone is 2363.50 to 2354.00. This zone essentially provided support last week when the market reached its low for the week at 2344.50.

Forecast

Based on the current price at 2383.75 and the earlier price action, the direction of the S&P 500 Index today is likely to be determined by trader reaction to the short-term Fibonacci level at 2381.50.

A sustained move over 2381.50 will indicate the presence of buyers. This could trigger a labored rally with a series of downtrending angles at 2388.50, 2396.50 and 2400.50, potential upside targets. The angle at 2400.50 is the last potential resistance angle before the 2404.50 main top.

A sustained move under 2381.50 will signal the presence of sellers. This could trigger a move into the short-term 50% level at 2374.50 and the longer-term uptrending angle at 2372.75.

Crossing to the weak side of the steep downtrending angle at 2372.50 will put the index in an extremely weak position with the next target 2363.50.

Watch the price action and read the order flow at 2381.50 all session. Trader reaction to this level will tell us if the buying is getting stronger or if sellers are re-taking control.