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E-mini S&P 500 Index (ES) Futures Technical Analysis – Needs to Close Over 3260.25 to Sustain Rally

By:
James Hyerczyk
Published: Jan 9, 2020, 15:59 UTC

Breaking back below yesterday’s high at 3267.75 will be the first sign of weakness. Crossing to the weak side of the previous main top at 3263.50 will be the second sign of weakness. Finally, turning lower for the session will indicate the sellers have taken control.

E-mini S&P 500 Index

March E-mini S&P 500 Index futures are trading higher shortly after the cash market opening after hitting a record higher earlier in the session. The headline readers are saying the market is being driven higher by easing tensions between Iran and the United States. Despite that optimistic outlook, there is still risk so expect heightened volatility over the near-term.

At 16:43 GMT, March E-mini S&P 500 Index futures are trading 3273.25, up 13.00 or +0.40%.

E-mini S&P 500 Index
Daily March E-mini S&P 500 Index

Daily Swing Chart Technical Analysis

Due to the excessive volatility this week, the swing indicator chart is probably the best tool to use for analysis at this time because all we have to focus on is the high, the low and the close. You can throw out overbought/oversold indicators at this time because they are useless. Besides they are coincidental.

The main trend was reaffirmed earlier today when buyers took out yesterday’s high. There is no upside target.

The main trend will change to down on a move through 3181.00. Taking out this bottom is not likely. However, traders should pay attention to yesterday’s close at 3260.25 especially on the close.

Trader reaction to 3260.25 will determine the intraday direction on Thursday. A close below 3260.25 will form a closing price reversal top. This won’t change the trend immediately, but it will indicate the selling is greater than the buying at current price levels.

If the closing price reversal top is confirmed, it could lead to the start of a 2 to 3 day correction.

The first intraday downside target is the rolling 50% level at 3227.50. The second intraday downside target is the main bottom at 3181.00 and the third is the intraday rolling 50% to 61.8% retracement zone at 3172.50 to 3148.50.

The retracement levels are “rolling” because we have established a top yet.

Daily Technical Analysis

If you’re trying to pick a top by selling new highs, you’re spinning your wheels because you’re the one that is giving the buyers a chance to get in.

Breaking back below yesterday’s high at 3267.75 will be the first sign of weakness. Crossing to the weak side of the previous main top at 3263.50 will be the second sign of weakness. Finally, turning lower for the session will indicate the sellers have taken control.

About the Author

James is a Florida-based technical analyst, market researcher, educator and trader with 35+ years of experience. He is an expert in the area of patterns, price and time analysis as it applies to futures, Forex, and stocks.

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