E-mini S&P 500 Index (ES) Futures Technical Analysis – Testing 50% Level of Short-Term Range

September E-mini S&P 500 Index futures are trading lower at the mid-session. The selling pressure is being fueled by concerns over a U.S. recession after the 2 and 10 year Treasury yields inverted, signaling a potential recession in about 22 months. Weaker-than-expected Chinese industrial production and retail sales data are also weighing on prices.

At 15:23 GMT, September E-mini S&P 500 Index futures are trading 2863.00, down 69.00 or -2.35%.

Daily Technical Analysis

The main trend is down according to the daily swing chart. A trade through 2944.25 will change the minor trend to up. A move through 2775.75 will signal a resumption of the downtrend.

The minor trend is also down. This changed to down earlier in the session, shifting momentum to the downside.

The main range is 2732.25 to 3029.50. Its retracement zone at 2881.00 to 2845.75 is currently being tested. This zone is controlling the near-term direction of the index.

The intermediate range is 3029.50 to 2775.75. Its retracement zone at 2902.75 to 2932.50 is resistance.

The short-term range is 2775.75 to 2944.25. Its 50% level or pivot is 2860.00. This level falls inside the main retracement zone. This zone is currently being tested. We could see an intraday short-covering rally if this level holds as support.

Daily Technical Forecast

Based on the early price action and the current price at 2863.00, the direction of the September E-mini S&P 500 Index is likely to be determined by trader reaction to the short-term 50% level at 2860.00.

Bearish Scenario

A sustained move under 2860.00 will indicate the selling is getting stronger. This could trigger a further break into the main Fibonacci level at 2845.75. If this fails then look for a break into the uptrending Gann angle at 2834.25.

Taking out 2834.25 will indicate the selling is getting stronger. Crossing to the weak side of the downtrending Gann angle at 2821.50 will put the index in a bearish position with the next target the uptrending Gann angle at 2783.25. This angle stopped the selling earlier in the week at 2775.75.

Bullish Scenario

A sustained move over 2860.00 will signal the presence of buyers. The first upside target is a 50% level at 2881.00. Overtaking this level could trigger a rally into the short-term 50% level at 2902.75, followed by a downtrending Gann angle at 2925.50. This angle stopped the buying on Tuesday and earlier today.