E-mini S&P 500 Index (ES) Futures Technical Analysis – Needs to Hold Pivot at 4668.50 to Sustain Upside Bias

December E-mini S&P 500 Index futures are trading flat early Thursday after finishing lower the previous session. Traders said worries over early rate hikes by the Federal Reserve after strong retail earnings weighed on the benchmark index.

At 03:41 GMT, December E-mini S&P 500 Index futures are at 4688.75, up 2.50 or +0.05%.

While strong retail data this week showed that a rise in inflation has not stifled economic growth so far, investors feared that further increases in prices could hurt growth and push the Federal Reserve into tightening policy ahead of schedule.

In stock-related news, Target Corp was the largest bid-name retailer to report positive results, as it raised its annual forecasts and beat profit expectations, citing an early start to holiday shopping. But shares of the firm fell 5.2%, tracking declines in those of peer Walmart on Tuesday, as both retailers flagged a hit to their third-quarter margins from supply chain issues.

Lowe’s Cos Inc rose 0.8% after the home improvement chain raised its full-year sales forecast on higher demand from builders and contractors, as well as a strong U.S. housing market. Peer Home Depot had also reported strong results on Tuesday.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. A trade through 4711.75 will signal a resumption of the uptrend. A move through 4625.25 will change the main trend to down.

The minor range is 4711.75 to 4625.25. Its 50% level at 4668.50 is the first support. The second support is the 50% level at 4627.75.

The short-term range is 4260.00 to 4711.75. If the main trend changes to down then its retracement zone at 4485.75 to 4432.50 will become the primary downside target.

Daily Swing Chart Technical Forecast

The direction of the December E-mini S&P 500 Index early Thursday is likely to be determined by trader reaction to 4690.25.

Bullish Scenario

A sustained move over 4690.25 will indicate the presence of buyers. If this move creates enough upside momentum then look for a surge into 4709.75. Taking out this level could lead to a quick test of the record high at 4711.75. This is a potential trigger point for an acceleration to the upside.

Bearish Scenario

A sustained move under 4690.25 will signal the presence of sellers. If this move generates enough downside momentum then look for a break into the pivot at 4668.50.

A sustained move under 4668.50 will indicate the selling is getting stronger. This could trigger the start of a further break into the support cluster at 4627.75 – 4625.25.

Taking out the main bottom at 4625.25 will not only change the main trend to down, but it could trigger the start of an acceleration to the downside with the first target a minor bottom at 4543.75, followed by a minor pivot at 4514.50 and the short-term retracement zone at 4485.75 to 4432.50.