E-mini S&P 500 Index (ES) Futures Technical Analysis – Nearest Support Cluster 3759.25 to 3749.75

March E-mini S&P 500 Index futures are edging lower Thursday after giving back earlier gains as investors look to extend the three-day winning streak.

The benchmark index posted a marginal gain the previous session with gains capped by a small drop in Amazon. After the close, investors watched a handful of stocks including eBay, PayPal and Qualcomm after each issued a quarterly earnings report.

At 04:53 GMT, March E-mini S&P 500 Index futures are trading 3816.00, down 7.50 or -0.20%.

Of the three, eBay easily outperformed with a climb of more than 9% in the after-hours market after beating on both the top and bottom lines and issuing a rosier-than-expected forecast for the first quarter.

On the economic front, the ADP Report showed hiring by U.S. private employers rebounded by 174,000 in January after a drop in December. A separate ISM survey showed services industry activity raced to its highest level in nearly two years in January.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart, however, momentum is trending higher. A trade through 3862.25 will change the main trend to up. A move through 3656.50 will signal a resumption of the downtrend.

The short-term range is 3862.25 to 3656.50. Its 50% level at 3759.25 is the first downside target.

The minor range is 3656.50 to 3843.50. Its 50% level at 3749.75 is the second downside target.

The intermediate range is 3596.00 to 3862.25. Its retracement zone at 3729.00 to 3697.75 is the next support area.

The main range is 3596.00 to 3862.25. Its retracement zone at 3679.75 to 3636.75 is the next major support area and value zone.

Short-Term Outlook

Although the index is hovering closer to the record high at 3862.25, it appears to be vulnerable to a steep correction into the support cluster at 3759.25 to 3749.75.

Since the dominant trend – weekly and monthly – is up, I think the upside will take care of itself even at current price levels. I think it’s more important to protect the downside, or at least for longer-term investors to be aware of the nearest short-term value area.