E-mini S&P 500 Index (ES) Futures Technical Analysis – Sellers Eyeing 50% Level at 4215.50

September E-mini S&P 500 Index futures are trading lower shortly before the cash market opening, erasing all of this week’s gains and putting the market in a position to post its first weekly loss in four.

Investor sentiment has been waning since Wednesday after the minutes from the Federal Reserve’s July meeting showed policymakers would not consider reining in interest rate hikes until inflation came down substantially, despite slightly softer consumer that offered some hope for a less-aggressive tightening path.

At 10:25 GMT, September E-mini S&P 500 Index futures are at 4252.75, down 33.75 or -0.79%. On Thursday, the S&P 500 Index Trust ETF (SPY) settled at $427.83, up $1.18 or +0.28%.

In after-market stock related news, shares of Applied Materials rose about 2% in extended trading after the company beat estimates on the top and bottom lines for its fiscal third quarter. The semiconductor equipment company also gave upbeat guidance for its fourth quarter, with revenue and earnings projections coming in higher than expected.

In other news, shares of Bed Bath & Beyond are down more than 40% in extended trading after activist investor Ryan Cohen revealed that he had exited his position in the company.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. A trade through 4327.50 will signal a resumption of the uptrend.

The minor trend is also up. A trade through 4103.75 will change the minor trend to up. This will shift momentum to the downside.

The main range is 4792.00 to 3639.00. The market is currently trading inside its retracement zone at 4215.50 to 4351.50. This zone is controlling the near-term direction of the index.

The intermediate range is 3723.75 to 4327.50. If the minor trend changes to down then its 50% level at 4025.50 will become the first downside target.

The short-term range is 3639.00 to 4327.50. Its retracement zone at 3983.00 to 3901.75 is support.

Daily Swing Chart Technical Forecast

Trader reaction to 4281.00 is likely to determine the direction of the September E-mini S&P 500 Index on Friday.

Bearish Scenario

A sustained move under 4281.00 will indicate the presence of sellers. If this move creates enough downside momentum then look for a break into the main 50% level at 4215.50.

Look for a technical bounce on the first test of 4215.50. If it fails, however, then look for an acceleration to the downside.

Bullish Scenario

A sustained move over 4281.00 will signal the presence of buyers. If this generates enough upside momentum then look for a surge into the weekly high at 4327.50, followed by 4351.50.