E-mini S&P 500 Index (ES) Futures Technical Analysis – Will Late Session Surge Take Out Main Top at 2894.00?

Based on the early price action and the current price at 2879.75, the direction of the June E-mini S&P 500 Index is likely to be determined by trader reaction to the Fibonacci level at 2872.50.
James Hyerczyk
E-mini S&P 500 Index

June E-mini S&P 500 Index futures are trading higher at the mid-session on Friday. However, intraday momentum has slowed since the early morning surge. If traders follow the pattern laid out throughout the week then look for another late session rally ahead of the weekend.

The catalyst behind the rally today is the weaker-than-expected U.S. Non-Farm Payrolls report. It sounds counter-intuitive, but the massive miss on payrolls is actually being interpreted as bullish since it increases the chances of a Fed rate cut. And we all know how investors love low interest rates.

At 17:28 GMT, June E-mini S&P 500 Index futures are trading 2879.25, up 33.50 or +1.17%.

Daily June E-mini S&P 500 Index

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. However, the strong four day rally has put the index in a position to challenge the last main top at 2894.00. A trade through this top will change the main trend to up.

The short-term range is 2894.00 to 2728.75. Its retracement zone at 2830.75 to 2811.25 is new support.

The main range is 2961.25 to 2728.75. The index is also trading on the strong side of this retracement zone at 2845.00 to 2872.50, indicating strong upside momentum. This zone could also develop into support.

Daily Swing Chart Technical Forecast

Based on the early price action and the current price at 2879.75, the direction of the June E-mini S&P 500 Index is likely to be determined by trader reaction to the Fibonacci level at 2872.50.

Bullish Scenario

A sustained move over 2872.50 will indicate the buying is getting stronger. If this creates enough late session momentum then look for the rally to possibly extend into the main top at 2894.00. This is a potential trigger point for an acceleration into a downtrending Gann angle at 2909.25.

Bearish Scenario

A sustained move under 2872.50 late in the day will signal the presence of sellers. This could create a labored break with potential targets coming in at 2856.75, followed by 2845.00.

Overview

The momentum is there, but will investors be willing to buy strength late in the session in an attempt to take out 2894.00?

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