E-mini S&P 500 Index (ES) Futures Technical Analysis – Needs to Hold 4543.75 to Sustain Upside Momentum

December E-mini S&P 500 Index futures closed higher on Friday after shaking off early weakness as a rise in Microsoft helped offset declines in Amazon and Apple after disappointing quarterly earnings from the online retailer and iPhone maker.

On Friday, December E-mini S&P 500 Index futures settled at 4602.50, up 15.00 or +0.33%.

The cash market S&P 500 had fallen as much as 0.65% earlier in the day. The benchmark index had advanced for a fourth straight week, its longest weekly streak of gains since April.

With 279 companies in the S&P 500 having reported results through Friday morning, 82.1% have topped earnings expectations, according to Refinitiv data. The current year-over-year earnings growth rate for the third quarter is 39.2%.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. The trend was reaffirmed on Friday when buyers took out 4590.00. The nearest main bottom is 4260.00. A trade through this level will change the main trend to down. This is highly unlikely, but due to the prolonged move up in terms of price and time, continue to watch for a closing price reversal top to perhaps bring an end to this rally.

The minor trend is also up. A trade through 4543.75 will change the minor trend to down. This will shift the momentum to the downside.

The minor range is 4543.75 to 4603.50. Its 50% level or pivot at 4573.50 is the nearest support. This level will move up as the market climbs above 4603.50.

The second minor range is 4317.25 to 4603.50. If the minor trend changes to down then its 50% level at 4460.25 will become the primary downside target.

Short-Term Outlook

The direction of the December E-mini S&P 500 Index early Monday is likely to be determined by trader reaction to 4602.50.

Bullish Scenario

A sustained move over 4602.50 will indicate the presence of buyers. Taking out 4603.50 will indicate the buying is getting stronger with no visible resistance.

Bearish Scenario

A sustained move under 4602.50 will signal the presence of sellers. If this creates enough downside momentum then look for the selling to possibly extend into 4573.50.

Buyers could come in on the first test of 4573.50. If it fails then sellers are likely to target the minor bottom at 4543.75.