E-mini S&P 500 Index (ES) Futures Technical Analysis – Trading Between Support at 2908.25, Resistance at 2934.75

September E-mini S&P 500 Index futures are trading sharply higher shortly before the mid-session after President Trump said he will be meeting with his Chinese counterpart, X Jinping, at the upcoming G-20 summit, boosting hope for a U.S.-China trade deal.

Trump said in a tweet he “had a very good telephone conversation” with Xi. He added:  We will be having an extended meeting next week at the G-20 in Japan. Our respective teams will begin talks prior to our meeting.”

At 16:53 GMT, September E-mini S&P 500 Index futures are trading 2925.50, up 29.25 or +1.03%.

Daily Technical Analysis

The main trend is up according to the daily swing chart. The uptrend was reaffirmed shortly after the cash market opening when buyers took out the previous top at 2915.75. The new main bottom is 2871.50. A trade through this level will change the main trend to down.

The minor trend is also up. A new minor bottom was formed at 2889.00. A trade through this minor bottom will change the minor trend to down. This will also shift momentum to the downside.

The main range is 2967.75 to 2732.25. Its retracement zone at 2877.75 to 2850.00 is controlling the direction of the index. Traders should consider this zone support.

Daily Technical Forecast

Based on the early price action and the current price at 2929.75, the direction of the September E-mini S&P 500 Index futures contract is likely to be determined by trader reaction to the downtrending Gann angle at 2934.25.

Bullish Scenario

Taking out 2934.25 and sustaining the rally late in the session could trigger an acceleration to the upside with the next major target the May 1 top at 2967.75.

Bearish Scenario

A sustained move under 2934.25 will signal the return of sellers. If this move creates enough downside momentum then look for a possible pullback into the steep uptrending Gann angle at 2908.25.

If 2908.25 fails then look for the selling to extend into the downtrending Gann angle at 2901.75. The market could take on a bearish tone if this angle fails as support with potential targets the minor bottom at 2889.00 and the Fibonacci level at 2877.75.

Overview

Today’s rally is a headline driven event so buyers are going to have to be willing to chase the market higher in order to trigger a breakout to the upside. With the Fed decision on Wednesday, buying may dry up into the close.