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E-mini S&P 500 Index (ES) Futures Technical Analysis – Weekly Chart Opens Up to Downside Under 2860.25

By:
James Hyerczyk
Published: Sep 18, 2018, 06:20 UTC

Based on last week’s close at 2906.25 and the previous weekly price action, the direction of the September E-mini S&P 500 Index this week is likely to be determined by trader reaction to the uptrending Gann angle at 2885.25. From the weekly chart, one can see that the way of least resistance is down at this time.

E-mini S&P 500 Index

September E-mini S&P 500 Index futures closed near its high last week and in a position to challenge the all-time high at 2917.50, but conditions changed over the week-end and the index is now facing selling pressure early this week.

The catalyst behind the early weakness is concern over an escalating trade dispute between the United States and China after President Trump imposed a 10% tariff on an additional $200 billion in Chinese goods. If China doesn’t negotiate a new deal before the end of the year, the tariff will rise to 25%.

E-mini S&P 500 Index
Weekly September E-mini S&P 500 Index

Weekly Technical Analysis

The main trend is up according to the weekly swing chart. A trade through 2917.50 will signal a resumption of the main trend. A move through 2693.25 will change the main trend to down.

The minor trend will change to down on a move through 2803.00. It will be reaffirm on a trade through 2791.00.

The minor range is 2803.00 to 2917.50. Its 50% level or pivot at 2860.25 is the first downside target. This price level is controlling the near-term direction of the index. Since the main trend is up, buyers could come in on the first test of this level. Look for an extension of the selling if it fails as support.

The main range is 2693.25 to 2917.50. A failure at 2860.25 could trigger a potential acceleration to the downside with its retracement zone at 2805.25 to 2779.00 the next likely target area. Once again, with the main trend up, buyers could come in on a test of this zone.

Weekly Technical Forecast

Based on last week’s close at 2906.25 and the previous weekly price action, the direction of the September E-mini S&P 500 Index this week is likely to be determined by trader reaction to the uptrending Gann angle at 2885.25.

A sustained move over 2885.25 will indicate the presence of buyers. If this move generates enough upside momentum then look for a possible retest of the contract high at 2917.50.

A sustained move under 2885.25 will signal the presence of sellers. This could trigger a break into the short-term pivot at 2860.25.

The weekly chart opens up to the downside under 2860.25 with the next major targets a short-term 50% level at 2805.25, followed by a pair of uptrending Gann angles at 2704.25 and 2789.25, and a short-term Fibonacci level at 2779.00.

From the weekly chart, one can see that the way of least resistance is down at this time.

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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