E-mini S&P 500 Index (ES) Futures Technical Analysis – Trade Through 3524.50 Negates Reversal Top

September E-mini S&P 500 Index futures are trading higher on Tuesday while hovering just under its all-time high. Prices have been mostly supported by a strong performance in the technology sector led by another surge in shares of Apple. Fundamentally, the index received a boost after the release of better-than-expected U.S. manufacturing sector data, which fueled optimism around a post-pandemic economic recovery.

At 19:20 GMT, September E-mini S&P 500 Index futures are trading 3515.75, up 16.75 or +0.48%.

Apple Inc gained 1.7%, rising for the second straight day after its stock split took effect, as a report said the iPhone maker had asked suppliers to make at least 75 million 5G iPhones for later this year.

ISM data showed U.S. factory activity expanded for the third straight month to a reading of 56.0 in August, the highest since January 2019. The figures follow encouraging manufacturing surveys from China and Europe earlier in the day.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. Momentum has slowed a little with the formation of the closing price reversal top on Monday and the subsequent confirmation of the chart pattern earlier today, but there was very little follow-through to the downside.

A trade through 3524.50 will negate the closing price reversal top and signal a resumption of the uptrend. The main trend will change to down on a trade through the last main bottom at 3195.00.

The minor trend is also up. A trade through 3344.75 will change the minor trend to down. This will also shift momentum to the downside.

The minor range is 3344.75 to 3524.50. If the selling pressure resumes then its retracement zone at 3434.50 to 3413.50 will become the primary downside target.

Short-Term Outlook

Trader reaction to 3524.50 late in the session could set the tone of the market the rest of the week.

Taking out 3524.50 could trigger another acceleration to the upside since we are in a strong momentum rally.

The inability to resume the uptrend following yesterday’s closing price reversal top and today’s confirmation of the chart pattern will indicate the selling may be greater than the buying at current price levels.

Although it won’t indicate a change in trend, taking out today’s intraday low at 3484.25 will indicate the selling is getting stronger. This could create the downside momentum needed to challenge the retracement zone at 3434.50 to 3413.50.

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