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E-mini S&P 500 Index (ES) Futures Technical Analysis – Trading on Strong Side of 4427.25 – 4412.00 Support

By:
James Hyerczyk
Published: Aug 23, 2021, 07:37 UTC

The direction of the September E-mini S&P 500 Index on Monday is likely to be determined by trader reaction to 4427.25.

E-mini S&P 500 Index (ES) Futures Technical Analysis – Trading on Strong Side of 4427.25 – 4412.00 Support

In this article:

September E-mini S&P 500 Index futures are trading sharply higher early Monday following a tumultuous week that drove the benchmark index violently in both directions last week. With earnings season and most of the major reports in the rearview mirror, all eyes will shift to the August 26-28 central bankers’ symposium where investors hope for clues on the Federal Reserve’s plan to begin tapering its emergency stimulus.

At 07:12 GMT, September E-mini S&P 500 Index futures are trading 4450.75, up 13.75 or 0.31%.

Traders are eagerly awaiting the Jackson Hole symposium for clues on the Fed’s timeline for dialing back its $120 billion a month bond-buying program. The event takes place virtually on Thursday and Friday. Last week, the index weakened as investors grew worried that the Fed’s potential move to pull monetary stimulus could slow down the economic recovery that is already challenged by the spread of the delta COVID-19 variant.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. Momentum just turned back up after a three-day setback.

A trade through 4476.50 will signal a resumption of the uptrend. A move through 4347.75 will change the main trend to down.

The short-term range is 4476.50 to 4347.75. The index is currently trading on the strong side of its retracement zone at 4427.25 to 4412.00, making it new support.

The main range is 4224.00 to 4476.50. Its retracement zone at 4350.25 to 4320.50 is the next important support area. It may be controlling the near-term direction of the market.

Daily Swing Chart Technical Forecast

The direction of the September E-mini S&P 500 Index on Monday is likely to be determined by trader reaction to 4427.25.

Bullish Scenario

A sustained move over 4427.25 will indicate the presence of buyers. If this move continues to generate strong upside momentum then look for buyers to make a run at the record high at 4476.50. It all depends on how much volume is created ahead of the Fed symposium.

Bearish Scenario

A sustained move under 4427.25 will signal the presence of sellers. The first downside target is 4412.00.

If 4412.00 fails to hold then the selling pressure could extend down to a minor retracement zone at 4401.25 to 4388.75. This zone will move up as the index moves higher on Monday.

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

About the Author

James is a Florida-based technical analyst, market researcher, educator and trader with 35+ years of experience. He is an expert in the area of patterns, price and time analysis as it applies to futures, Forex, and stocks.

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