E-mini S&P 500 Index (ES) Futures Technical Analysis – Trading on Bullish Side of Retracement Zone Target

December E-mini S&P 500 Index futures are trading sharply higher at the mid-session after a shaky start as the race for the White House went down to the wire, although investors remained worried about the prospect of a contested result.

The bullish price action suggests traders are betting on a Joe Biden win since he represents the possibility of massive amounts of fiscal stimulus, which would give the economy and the stock market a huge boost. Although there are some that say prices could be taxed if Biden decides to move forward with aggressive tax increases.

At 15:55 GMT, December E-mini S&P 500 Index futures are trading 3457.75, up 96.25 or +2.86%.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. A trade through 3541.00 will reaffirm the uptrend. The main trend will change to down on a move through 3225.00.

The minor trend is also up. A trade through 3462.50 changed the minor trend to up. This also shifted momentum to the upside.

The main range is 2916.50 to 3576.25. Its retracement zone at 3246.25 to 3168.50 is support. This zone stopped the selling at 3225.00 on October 30.

The minor range is 3541.00 to 3225.00. Its retracement zone is 3383.00 to 3420.25. The market is currently trading on the strong side of this zone, making it support.

Daily Swing Chart Technical Forecast

The direction of the December E-mini S&P 500 Index into the close is likely to be determined by trader reaction to the minor Fibonacci level at 3420.25.

Bullish Scenario

A sustained move over 3420.25 will indicate the presence of buyers. If this move is able to generate enough upside momentum then look for potential moves into the pair of minor tops at 3462.50 and 3508.50, followed by a pair of main tops at 3541.00 and 3576.25.

Bearish Scenario

A sustained move under 3420.25 will signal the presence of sellers. This is followed by the minor 50% level at 3383.00. This could trigger a break to around 3345.00. If this level fails then look for the selling to possibly extend into the main 50% level at 3246.25, followed by the main bottom at 3225.00.