E-mini S&P 500 Index (ES) Futures Technical Analysis – Weekly Chart: Strengthens Over 2815.50, Weakens Under 2775.00

December E-mini S&P 500 Index futures settled higher last week, helped by the outcome of the mid-term elections, which resulted in a split Congress. The results came in as predicted with the Democrats recapturing the House of Representatives and the Republicans maintaining control of the Senate. Investors celebrated because the volatility that many had predicted failed to materialize.

Last week, the December E-mini S&P 500 Index settled at 2779.00, up 54.75 or +2.01%.

Weekly Swing Chart Technical Analysis

The main trend is down according to the weekly swing chart. The main trend will turn to up on a trade through 2947.00. A trade through 2603.00 will signal a resumption of the downtrend.

The direction of the index is being controlled by a series of retracement levels. They indicate the way of least resistance is up. Any sell-off is likely to be labored.

The short-term range is 2947.00 to 2603.00. Its retracement zone is 2775.00 to 2815.50. The index is currently trading inside this zone. It is controlling the near-term direction of the index.

The intermediate range is 2550.00 to 2947.00. Its retracement zone at 2748.50 to 2701.50 is support.

The contract range is 2496.00 to 2947.00. Its retracement zone at 2721.50 to 2668.25 is also support. However, more importantly, it is controlling the longer-term direction of the index.

The combination of the intermediate and contract ranges creates a major support zone at 2748.50 to 2701.50. Inside this zone is the major 50% level at 2721.50.

Weekly Swing Chart Technical Forecast

Based on last week’s close at 2779.00, the direction of the December E-mini S&P 500 Index this week is likely to be determined by trader reaction to the short-term 50% level at 2775.00.

A sustained move over 2775.00 will indicate the presence of buyers. If this creates enough upside momentum then look for a surge into the short-term Fibonacci level at 2815.50. This is a potential trigger point for an acceleration to the upside.

The weekly chart indicates there is plenty of room to the upside over 2815.50 with 2947.00 the next major upside target.

A sustained move under 2775.00 will signal the presence of sellers. This could lead to the start of a stair-step break with downside targets lined up at 2748.50 and 2721.50.

The selling pressure could increase dramatically under 2721.50 with the next pair of targets coming in at 2701.50 and 2668.25.