E-mini S&P 500 Index (ES) Futures Technical Analysis – Sellers Targeting 3285.25 to 3268.00

March E-mini S&P 500 Index futures are trading sideways to lower shortly before the cash market opening as investors continue to assess the economic impact of the coronavirus outbreak in China.

Helping to keep a lid on prices are steady reports updating investors on the death toll from the virus. The futures contract opened lower, but investors pared losses after Chinese President Xi Jinping said China would speed up development of drugs aimed at treating pneumonia-like viruses. Xi also said China will win the fight against the coronavirus.

At 13:11 GMT, March E-mini S&P 500 Index futures are trading 3321.75, down 3.75 or -0.11%.

There are no major U.S. economic reports scheduled for Monday, but some traders are expecting a drop-off in volume ahead of Fed Chairman Jerome Powell’s testimony before Congress on Tuesday and Wednesday.

Daily Technical Analysis

The main trend is up according to the daily swing chart. A trade through 3357.75 will signal a resumption of the uptrend after a two-day setback. The main trend will change to down on a move through 3212.75. This is highly unlikely, but there is room for a normal 50% to 61.8% correction.

The short-term range is 3212.75 to 3357.75. Its retracement zone at 3285.25 to 3268.00 is the first downside target. Since the trend is up, look for buyers on the first test of this zone, which some will see as a value area.

Daily Technical Forecast

Based on the early price action and the current price at 3321.75, the direction of the March E-mini S&P 500 Index the rest of the session on Monday is likely to be determined by trader reaction to the downtrending Gann angle at 3325.75.

Bullish Scenario

A sustained move over 3325.75 will indicate the presence of buyers. If this creates enough upside momentum then look for the buying to possibly extend into a pair of downtrending Gann angles at 3341.75 and 3349.75. The latter is the last potential resistance angle before the 3357.75 main top.

Bearish Scenario

A sustained move under 3325.75 will signal the presence of sellers. The first downside target is an uptrending Gann angle at 3308.75. This angle was tested earlier in the session.

If 3308.75 fails then look for a potential acceleration to the downside with the next target a 50% level at 3285.25. This is followed by a Fibonacci level at 3268.00.