E-mini S&P 500 Index (ES) Futures Technical Analysis – Strengthens Over 3006.75, Weakens Under 3004.50

December E-mini S&P 500 Index futures are expected to open steady to lower based on the pre-market trade. Volume is well-below average as most major players are on the sidelines ahead of the U.S. Federal Reserve’s interest rate decision, monetary policy statement at interest rate expectations, due to be released at 18:00 GMT.

At 13:08 GMT, December E-mini S&P 500 Index futures are trading 3004.50, down 3.50 or -0.12%.

The Fed is widely expected to cut rates by 25 basis points, but investors are more concerned about future cuts. The market is expecting a cut in October and December. However, the Fed may skip the October cut because the economy has been performing well and cut in December. It may even hint that two more rate cuts are a little too aggressive.

A dovish Fed should be a positive for stocks. A hawkish Fed could trigger a break due to overvalued conditions and profit-taking.

Daily Technical Analysis

The main trend is up according to the daily swing chart, however, momentum has been trending lower since the formation of the closing price reversal top at 3025.75 on September 13.

A trade through 3025.75 will negate the closing price reversal top and signal a resumption of the uptrend. A move through 2958.75 will change the main trend to down.

The minor trend is also up. A trade through 2983.50 will change the minor trend to down.

Two minor pivots at 3004.75 and 2992.25 have been controlling the price action this week.

The major downside target retracement zone is 2918.25 to 2893.00.

Daily Technical Forecast

Based on the early price action, 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 uptrending Gann angle at 3006.75 and the minor pivot at 3004.50.

Bullish Scenario

A sustained move over 3006.75 will indicate the presence of buyers. If this move creates enough upside momentum then look for a test of 3025.75.

Bearish Scenario

A sustained move under 3004.50 will signal the presence of sellers. This could trigger a quick break into 2992.25, 2983.50 and 2982.75.

The angle at 2982.75 is the trigger point for an acceleration into 2958.75.

A trade through 2958.75 will change the main trend to down. This could trigger another acceleration to the downside with the next major target angle coming in at 2939.00.