E-mini S&P 500 Index (ES) Futures Technical Analysis – Successful Test of 4664.25 – 4630.25 Support Area

March E-mini S&P 500 Index futures are edging lower late in the session on Friday in a choppy trade as investors assess today’s mixed non-farm payrolls report, while still dealing with the Federal Reserve’s plan to tighten monetary policy more aggressively.

“The stock market is undergoing somewhat of a transition right now, after a very strong 2021,” said Jay Pestrichelli, CEO of ZEGA Financial. “We are seeing more volatility in individual stocks compared to the indexes, and we are seeing a change in leadership in the market, as investors reconsider the high flying tech stocks of 2021 as interest rates rise.”

At 20:27 GMT, March E-mini S&P 500 Index futures are trading 4676.50, down 11.00 or -0.23%. The S&P 500 Trust ETF (SPY) is at 466.71, down $1.23 or -0.26%.

In economic news, the Labor Department reported the U.S. economy added far fewer jobs in December than expected. The nonfarm payrolls report showed an increase of 199,000 in December, though economists had expected growth of 422,000, according to Dow Jones. Additionally, the unemployment rate fell to 3.9%, well below the 4.1% expected, and average hourly earnings increased by 0.6%, above expectations.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. A trade through the intraday low at 4653.75 will signal a resumption of the uptrend. A move through 4808.25 will change the main trend to up.

The index is only down four sessions from its last main top, but a higher close on Friday will produce a minor closing price reversal bottom that could lead to a minor retracement to the upside on Monday.

The short-term range is 4520.25 to 4808.25. Its retracement zone at 4664.25 to 4630.25 stopped the selling earlier today at 4653.75.

The new minor range is 4808.25 to 4653.75. If there is a short-term correction then look for a move into its retracement zone at 4731.00 to 4749.25.

The support is a major retracement zone at 4530.50 to 4465.00.

Short-Term Outlook

The direction of the March E-mini S&P 500 Index into the close on Friday is likely to be determined by trader reaction to 4687.50.

Look for an upside bias early next week on a close over 4687.50. This could lead to a test of 4731.00 – 4749.25.

A close under 4687.50 will indicate the presence of sellers that could lead to a retest of 4664.25 – 4630.25 early next week.