E-mini S&P 500 Index (ES) Futures Technical Analysis – Trade Through 3268.25 Shifts Momentum to Upside

December E-mini S&P 500 Index futures are called lower based on the pre-market trade as investors remained skeptical of more fiscal stimulus needed to shore up a domestic economy hammered by the pandemic-driven recession.

At 13:24 GMT, December E-mini S&P 500 Index futures are trading 3226.75, down 11.25 or -0.35%.

After weeks of stalemate in talks over a fifth coronavirus relief bill, a key lawmaker said on Thursday Democrats in the U.S. House of Representatives were working on a $2.2 trillion package that could be voted on as early as next week.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart, but Thursday’s closing price reversal bottom is indicating a shift of momentum may be taking place.

A trade through 3198.00 will negate the closing price reversal bottom and signal a resumption of the downtrend.

A move through Thursday’s high at 3268.25 will confirm the closing price reversal chart pattern. This won’t change the main trend to up, but it could trigger the start of a 2 to 3 day counter-trend rally.

The main range is 2916.50 to 3576.25. The index is currently testing its retracement zone at 3246.50 to 3168.50. Trader reaction to this zone could determine the longer-term direction of the index.

The minor range is 3419.50 to 3198.00. Its 50% level at 3308.75 is the first upside target.

Daily Swing Chart Technical Forecast

Based on the early price action, the direction of the December E-mini S&P 500 Index on Friday is likely to be determined by trader reaction to the main 50% level at 3246.50.

Bearish Scenario

A sustained move under 3246.50 will indicate the presence of sellers. The first target is 3198.00. Taking out this level will signal a resumption of the downtrend which could lead to a quick test of a pair of main bottoms at 3184.75 and 3181.75, followed by the main Fibonacci level at 3168.50.

The Fib level at 3168.50 is a potential trigger point for an acceleration to the downside with the next target the main bottom at 3095.00.

Bullish Scenario

A sustained move over 3246.50 will signal the presence of buyers. This could lead to a quick test of 3268.25. Taking out this level will confirm the closing price reversal bottom. This could create the upside momentum needed to challenge the first minor 50% level at 3308.75.

For a look at all of today’s economic events, check out our economic calendar.