E-mini S&P 500 Short Sellers Eyeing 4419.25 – 4398.75

March E-mini S&P 500 Index futures are trading lower shortly after the opening on Friday after an unexpected surge in jobs in January spiked bond yields and reaffirmed to investors the Federal Reserve would continue with its plan to raise interest rates as soon as March.

At 14:38 GMT, March E-mini S&P 500 Index futures are trading 4460.00, down 9.00 or -0.20%. The S&P 500 Trust ETF (SPY) is at $445.62, down $0.98 or -0.22%.

The 10-year Treasury yield jumped above 1.9%, its highest level since January 2020, after the January jobs report showed a 467,000 gain in payrolls. Economists polled by Dow Jones had expected a minor gain of 150,000 and some economists predicted a large decrease. Economists had cautioned before the report it could be noisy because of an omicron wave hitting while the survey was taking place.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart, however, momentum is trending higher.

A trade through 4586.00 will change the main trend to up. A move through 4212.75 will signal a resumption of the downtrend.

The minor trend is up. This is controlling the momentum. A trade through 4263.25 will change the minor trend to down.

The short-term range is 4808.25 to 4212.75. Its retracement zone at 4510.50 to 4580.75 is resistance. This area stopped the rally on Wednesday at 4586.00.

The major support is a pair of retracement levels at 4419.25 – 4327.50 and 4266.00 – 4137.50.

The minor range is 4212.75 to 4586.00. Its retracement zone at 4398.75 to 4355.00 is additional support.

The retracement zones have formed two potential support clusters at 4419.25 – 4398.75 and 4355.00 – 4327.50.

Daily Swing Chart Technical Analysis

Look for a downside bias as long as the retracement zone at 4510.50 – 4580.75 continues to reject rallies. If this move creates enough downside momentum then look for a test of 4419.25 – 4398.75. Watch for buyers on the first test of this area.

If 4398.75 fails as support then look for the selling to extend into 4355.00 to 4327.50. Buyers could also show up on a test of this area.

Overtaking 4510.50 will be the first sign of strength. This could trigger a surge into the resistance cluster at 4581.00 – 4586.00.

Taking out 4586.00 could trigger an acceleration to the upside.