E-mini S&P 500 Index (ES) Futures Technical Analysis – Weekly Chart Strengthens Over 2877.75, Weakens Under 2850.00

September E-mini S&P 500 Index futures settled higher last week, following through to the upside after confirming the previous week’s closing price reversal bottom. The market continues to be supported by increasing odds of a Federal Reserve rate cut as soon as July.

The Fed is set to begin a two-day policy meeting this week with stock market investors looking for clues for an easing monetary policy later this year. Traders aren’t expecting a June rate cut, but are pricing in a more than 80% chance of a rate cut in July and 70% probability of another cut in September, according to the CME Group’s FedWatch tool.

Last week, September E-mini S&P 500 Index futures settled at 2894.75, up 16.25 or +0.56%.

Weekly Technical Analysis

The main trend is up according to the weekly swing chart. A trade through 2967.75 will signal a resumption of the uptrend. The main trend will change to down on a trade through 2732.25.

The short-term range is 2967.75 to 2732.25. Its retracement zone at 2877.75 to 2850.00 is controlling the near-term direction of the index. Holding above this zone will help maintain the upside bias. Traders should consider this zone support.

Weekly Technical Forecast

Based on last week’s price action and the close at 2894.75, the direction of the September E-mini S&P 500 Index this week is likely to be determined by trader reaction to the Fibonacci level at 2877.75.

Bullish Scenario

A sustained move over 2877.75 will indicate the presence of buyers. The first upside target is a downtrending Gann angle at 2911.75. Sellers could come in on the first test of this angle, but if it is taken out then look for the rally to possibly extend into a pair of downtrending Gann angles at 2939.75 and 2953.75. The latter is the last potential resistance angle before the 2967.75 main top.

Bearish Scenario

A sustained move under 2877.75 will signal the presence of sellers. This could lead to a test of a steep uptrending Gann angle at 2860.25. This is followed by a 50% level at 2850.00.

The 50% level at 2850.00 is the trigger point for an acceleration to the downside with the next target angle coming in at 2796.25.

The major support is a combination of the short-term uptrending Gann angle at 2764.25 and the long-term uptrending Gann angle at 2747.25.

Overview

The key area to watch is the short-term retracement zone at 2877.75 to 2850.00. Look for the upside bias to continue on a sustained move over 2877.75 and for a downside bias to develop on a sustained move under 2850.00.