E-mini S&P 500 Index (ES) Futures Technical Analysis – Selling Pressure Puts 4602.00 Pivot on the Radar

December E-mini S&P 500 Index futures are trading flat early Friday after investors took profits the previous session following the market rebound earlier in the week and turned their focus to inflation data due out Friday.

At 04:18 GMT, December E-mini S&P 500 Index futures are trading 4671.75, up 4.75 or + 0.10%. On Thursday, the S&P 500 ETF Trust (SPY) ETF settled at $466.32, down $3.20 or -0.68%.

Trading was largely muted as investors await more data from the Labor Department, which will release the November consumer price index at 13:30 GMT on Friday. It was the market’s second day of pause, following the two-day market rally earlier this week as they turned their attention to the economic data instead.

Investors expect a high inflation reading, which could lead the Federal Reserve to hasten the taper of its $120-billion monthly bond-buying program. Economists surveyed by Dow Jones expect a 0.7% gain for the month of November, which would translate to a year-over-year growth rate of 6.7%. If that is the case, it will mark the biggest move since June 1982.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. However, momentum is trending higher. A trade through 4717.00 will change the main trend to up. A move through 4740.50 will reaffirm the uptrend with a new all-time high. A move through 4492.00 will signal a resumption of the downtrend.

The minor trend is up. This is controlling the upside momentum. The new minor top is 4712.00. Taking out this level will indicate the buying is getting stronger.

The new minor range is 4492.00 to 4712.00. Its 50% level at 4602.00 is the nearest support and primary downside target.

The short-term range is 4260.00 to 4740.50. Its retracement zone at 4500.25 to 4443.50 is the next support area. It stopped the selling at 4492.00 on December 3.

The major support zone is 4428.75 to 4355.25.

Daily Swing Chart Technical Forecast

The direction of the December E-mini S&P 500 Index on Friday is likely to be determined by trader reaction to 4687.00.

Bearish Scenario

A sustained move under 4687.00 will indicate the presence of sellers. Taking out 4662.25 will indicate the selling pressure is getting stronger. If this move is able to create enough downside momentum then look for the selling to possibly extend into 4602.00 over the short-run.

Bullish Scenario

A sustained move over 4687.00 will signal the presence of buyers. If this move generates enough upside momentum then look for a surge into 4712.00.

Overcoming 4712.00 will indicate the buying is getting stronger with 4717.00 the next target. Taking out this main top will change the main trend to up.