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E-mini S&P 500 Index (ES) Futures Technical Analysis – Strengthens Over 2921.50, Weakens Under 2915.00

By:
James Hyerczyk
Published: Oct 2, 2019, 12:37 UTC

Based on the early price action and the current price at 2926.00, the direction of the December E-mini S&P 500 Index the rest of the session on Wednesday is likely to be determined by trader reaction to the downtrending Gann angle at 2921.50 and the uptrending Gann angle at 2915.00.

E-mini S&P 500 Index

December E-mini S&P 500 Index futures are expected to open lower based on the pre-market trade. The early selling is in response to yesterday’s bearish ISM Manufacturing PMI report, which fanned the flames of recession.  Today’s ADP private sector jobs report came in at 135,000, slightly below the 140,000 forecast, but well below last month’s 195,000 reading. This indicates the pace of hiring is slowing.

At 12:19 GMT, December E-mini S&P 500 Index futures are trading 2926.00, down $11.25 or -0.39%.

The ADP report is not bearish per se, but it’s not strong enough to change investor sentiment either. There could be a short-covering rally, but gains are likely to be capped. Furthermore, buyers aren’t likely to get too aggressive ahead of Friday’s U.S. Non-Farm Payrolls report.

E-mini S&P 500 Index
December E-mini S&P 500 Index

Daily Technical Analysis

The main trend is down according to the daily swing chart. The market is in no position to change the main trend to up, but it is down 13 sessions from the last main top, which makes it ripe for a closing price reversal bottom. This chart pattern won’t change the trend, but it could lead to a short-covering rally.

The main range is 2811.00 to 3025.75. Its retracement zone is 2918.25 to 2893.00. This zone is controlling the near-term direction of the index. Its upper or 50% level at 2918.25 held as support earlier in the session.

The short-term range is 3025.75 to 2916.75. Its retracement zone at 2971.25 to 2984.00 is potential resistance.

Daily Technical Forecast

Based on the early price action and the current price at 2926.00, the direction of the December E-mini S&P 500 Index the rest of the session on Wednesday is likely to be determined by trader reaction to the downtrending Gann angle at 2921.50 and the uptrending Gann angle at 2915.00. These angles are surrounding the main 50% level at 2918.25.

Bullish Scenario

A sustained move over 2921.50 will indicate the presence of buyers. Overcoming 2937.75 and turning higher for the session will indicate the buying is getting stronger. This will also put the index in a position to post a closing price reversal bottom. If this is able to generate enough upside momentum then look for a potential rally into 2971.25 to 2973.00.

Bearish Scenario

A sustained move under 2915.00 will signal the presence of sellers. This is a potential trigger point for an acceleration to the downside with the next target the Fibonacci level at 2893.00. The market could break further under this level with the next target angle coming in at 2863.00.

About the Author

James is a Florida-based technical analyst, market researcher, educator and trader with 35+ years of experience. He is an expert in the area of patterns, price and time analysis as it applies to futures, Forex, and stocks.

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