E-mini S&P 500 Index (ES) Futures Technical Analysis – Posting Its Worst First-Half Loss in 50+ Years

September E-mini S&P 500 Index futures are trading lower late in the session on Thursday in a choppy trade. The benchmark index is well off its session low, and in a position to post its worst first-half loss in more than 50 years.

Investors are blaming decades-high inflation and aggressive interest rate hikes from the Federal Reserve, which are stoking fears of a possible recession, for the weakness.

At 18:38 GMT, September E-mini S&P 500 Index futures are trading 3804.00, down 17.25 or -0.45%. The S&P 500 Trust ETF (SPY) is at $378.76, down $1.58 or -0.41%.

Economic data released on Thursday did little to allay those fears. Disposable income inched lower, consumer spending decelerated, inflation remained hot and jobless claims inched higher.

Finally, of the 11 major sectors of the S&P 500, utilities were up the most, with energy suffering the largest percentage drop.

Short-Term Outlook

Trader reaction to the short-term 50% level at 3794.50 is likely to determine the direction of the September E-mini S&P 500 Index into the close on Thursday.

Bullish Scenario

A sustained move over 3794.50 will indicate the presence of buyers. If this creates enough upside momentum then look for an intraday surge into the minor pivot at 3847.75.

Since the main trend is down, look for sellers on the first test of 3947.75. Overcoming this level, however, could trigger an acceleration into the intermediate 50% level at 3922.00, followed by the main top at 3950.00 and the 61.8% level at 3988.75.

Bearish Scenario

A sustained move under 3794.50 will be a sign of weakness. This could lead to a quick test of the Fibonacci level at 3757.75, followed by the intraday low at 3741.25.

Taking out 3741.25 could trigger a late session break that could turn into an acceleration to the downside with the main bottom at 3639.00 the next major target.