E-mini S&P 500 Index (ES) Futures Technical Analysis – Uptrend Continues as Index Pierces 4000 Mark

June E-mini S&P 500 Index futures are trading higher late in the session on Thursday as the cash index jumped past the 4,000 mark for the first time. The benchmark index was driven higher by strong performances in Microsoft, Amazon and Alphabet, as well as optimism about a recovering U.S. economy.

At 18:50 GMT, June E-mini S&P 500 Index futures are trading 4003.25, up 35.75 or +0.90%.

In other news, data showed the number of Americans filing new claims for unemployment benefits rose unexpectedly last week. However, other data showed a measure of manufacturing activity soared to its strongest level in more than 37 years in March, with employment at factories the highest since February 2018.

The S&P 500 posted 25 new 52-week highs and no new lows; the NASDAQ Composite recorded 73 new highs and 11 new lows.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. The uptrend resumed earlier in the session when buyers took out the previous day’s high. The main trend will change to down on a move through the nearest main bottom at 3843.25.

We’re not looking for a change in trend at this time, but it’s not too early to start watching for a potentially bearish closing price reversal top. The index will enter the window of time for such a move within the next 2 to 5 sessions.

A closing price reversal top won’t change the main trend to down, but if confirmed, it could trigger the start of a 2 to 3 day correction.

Traders should start watching the CBOE Volatility Index since it slipped below 18 for the first time in 14 months. This is a complacency indicator, which tends to indicate investors aren’t too worried about the downside risks. It’s one of the best contrarian indicators so make sure you have it inside your trading toolbox.

Short-Term Outlook

The direction of the index into the close is likely to be determined by trader reaction to 3967.50.

Bullish Tone

A sustained move over 3967.50 will indicate the presence of buyers. There is no resistance at this time.

Bearish Scenario

Crossing under the previous highs at 3983.75 will be the first sign of weakness. Turning lower for the session on a move under 3967.50 will put the index in a position to post a closing price reversal top.