E-mini S&P 500 Index (ES) Futures Technical Analysis – Still Vulnerable to Closing Price Reversal Top

June E-mini S&P 500 Index futures are trading higher at the mid-session on Wednesday. Earnings continue to be supportive, but the market is getting an additional boost from a surge in oil sector stocks. Weakness in IBM has been a little bit of a drag on the index.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. Momentum has been steadily increasing since the trend changed to up on the trade through 2672.25 late last week.

The index is currently trading inside a major retracement zone bounded by 2707.75 and 2749.25. This zone is controlling the longer-term direction of the market.

The new short-term range is 2552.00 to 2718.50. Its retracement zone is new support at 2635.25 to 2615.50.

The market isn’t close to changing the main trend to down, but it is in the window of time for a closing price reversal top.

Daily Swing Chart Technical Forecast

Based on the early price action, the direction of the index into the close is likely to be determined by trader reaction to the major 50% level at 2707.75.

A sustained move over 2707.75 will signal the presence of buyers. If this move can generate enough upside momentum, we’re looking at a possible extension of the rally into the main Fibonacci level at 2749.25.

A sustained move under 2707.75 will indicate the presence of sellers. This could trigger a break into the next 50% level at 2679.50.

The 50% level at 2679.50 is the trigger point for a potential acceleration to the downside with 2635.25 the next likely downside target.

Watch the price action and read the order flow at 2707.75 all session. Trader reaction to this level will tell us if the bulls are still in control, or if the selling is greater than the buying at current price levels.