E-mini S&P 500 Index (ES) Futures Technical Analysis – New Minor Support Moves Up to 4142.25

June E-mini S&P 500 Index futures closed higher on Friday with the benchmark index breaking another record close. The strength was driven by strong economic data and bank earnings which served as signs of momentum in the U.S. pandemic recovery.

On Friday, June E-mini S&P 500 Index futures settled at 4176.25, up 13.75 or +0.33%.

Nine of the 11 S&P sub-sectors rose on Friday. The energy and information technology indexes were the exceptions. The, dipping 0.9%, was weighed by lower oil prices, while the latter was marginally lower, the day after its highest-ever close.

In other news, Morgan Stanley reported a 150% jump in quarterly profit on Friday, joining other big banks in posting first-quarter numbers reinforcing hopes of a swift economic recovery.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. The uptrend was reaffirmed on Friday when buyers took out the previous high at 4166.50.

A trade through 3843.25 will change the main trend to down. This is highly unlikely, but since the index is up 15 days from its last main bottom, it closed Friday’s session inside the window of time for a closing price reversal top.

The minor trend is also up. A trade through 4101.5 will change the minor trend to down. This will also shift momentum to the downside.

The minor range is 4101.25 to 4183.50. Its 50% level at 4142.25 is potential support.

The main range is 3843.25 to 4183.50. If the minor trend changes to down then this will open up the possibility of a further decline into its retracement zone at 4013.25 to 3973.25.

Short-Term Outlook

There is no resistance so it’s important to watch for a few patterns that could signal a short-term top.

Taking out Friday’s low at 4154.25 will make 4183.50 a new minor top. This will be a sign that the selling may be greater than the selling at current price levels.

Taking out 4183.50 then closing lower for the session will form a closing price reversal top. If confirmed then this could trigger the start of a 2 to 3 day correction.

It doesn’t make sense to try to pick a top. When you try to short, you’re only feeding the bull.

If this market is going to form a short-term top, it’s not likely to be related to an economic event, but rather surprise news.