E-mini S&P 500 Index (ES) Futures Technical Analysis – Testing Weekly Pivot Angle at 2779.50

March E-mini S&P 500 Index futures finished higher last week with the rally driven by the hopes of a trade deal between the U.S. and China, and the ability to avert another government shutdown. The market also showed some resilience by coming back from a steep sell-off last Thursday that was trigger by weaker-than-expected U.S. retail sales data.

Last week, March E-mini S&P 500 Index futures settled at 2777.00, up 70.75 or +2.55%.

The New York Stock Exchange is closed today along with the Chicago Mercantile Exchange and the U.S. Treasury because of the U.S. President’s Day holiday. The low volume price action is taking place on the Globex electronic trading system. It will close early today.

Weekly Technical Analysis

The main trend is down according to the daily swing chart, however, momentum has been trending higher since the formation of a closing price reversal bottom at 21452 the week-ending December 28.

A trade through 2955.50 will change the main trend to up. The index is up eight weeks from its last main bottom, which puts it in a position to post a potentially bearish closing price reversal top.

The minor trend is up. A trade through 2819.00 will change the minor trend to up. This will reaffirm the shift in momentum. This is followed closely by another minor top at 2824.50.

The main range is 2955.50 to 2316.75. Its retracement zone at 2636.00 to 2711.50 is controlling the direction of the market. Trading above this zone is helping to generate a strong upside bias.

Weekly Technical Forecast

Based on the price action of the eight week rally, the direction of the March E-mini S&P 500 Index futures contract this week is likely to be determined by trader reaction to a downtrending Gann angle at 2779.50.

Bullish Scenario

A sustained move over the angle at 2779.50 will indicate the presence of buyers. The first target is the steep uptrending Gann angle at 2828.75. Overcoming this angle will put the index in an extremely bullish position with the next target angle coming in at 2867.50. This is followed by a pair of downtrending Gann angles at 2911.50 and 2933.50. The latter is the last potential resistance angle before the 2955.50 main top.

Bearish Scenario

A sustained move under 2779.50 will signal the presence of sellers. This could drive the index into the major Fibonacci level at 2711.50. We could see a technical bounce on the first test of this level. If it fails then look for the selling to extend into the major 50% level at 2636.00. This is another trigger point for an acceleration to the downside with the next major target angle coming in at 2572.75.