E-mini S&P 500 Index (ES) Futures Technical Analysis – Trader Reaction to 3660.00 Sets Tone into Close

March E-mini S&P 500 Index futures are edging lower late in the session on Tuesday as worries over a new variant of COVID-19 and downbeat economic data dampened enthusiasm over the passage of a long-awaited pandemic relief bill in Washington.

Fears of the coronavirus and optimism about an eventual economic recovery made for extreme volatility on Wall Street in 2020, with the S&P 500 logging daily gains or losses of 2% or more over 40 times in a year so far, the most in over a decade.

At 19:43 GMT, March E-mini S&P 500 Index futures are trading 3678.75, down 7.00 or -0.19%.

Apple was an outlier amid a broad sell-off, gaining 3.6% and providing the biggest lift to all three major U.S. stock indexes on news of the company’s plans to roll out an electric passenger vehicle by 2024.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. The trend turned down on Monday when sellers took out 3620.75. The lack of follow-through to the downside and the quick rebound, however, suggest the move was likely fueled by sell stops rather than aggressive selling.

A trade through 3724.00 will change the main trend to up. A move through 3596.00 will signal a resumption of the downtrend.

The minor range is 3724.00 to 3596.00. Its 50% level at 3660.00 is controlling the price action on Tuesday.

The second minor range is 3497.25 to 3724.00. Its retracement zone at 3610.50 to 3583.75 is support. This zone stopped the selling on Monday at 3596.00.

Daily Swing Chart Technical Forecast

The direction of the March E-mini S&P 500 Index into the close on Tuesday is likely to be determined by trader reaction to 3660.00.

Bullish Scenario

A sustained move over 3660.00 will indicate the presence of buyers. If this creates enough upside momentum then look for the rally to possibly extend into 3724.00.

Bearish Scenario

A sustained move under 3660.00 will signal the presence of sellers. This could trigger a steep break into the support cluster at 3610.50 to 3583.75.