E-mini S&P Strengthens Over 4470.00, Weakens Under 4419.25

March E-mini S&P 500 Index futures are trading higher shortly after the cash market opening on Tuesday on reports Russia may be backing away from an immediate invasion of Ukraine, dampening geopolitical tensions that have pressured the benchmark index the last three days.

The Russian Defense Ministry said it had begun returning some troops to deployment bases after training exercises near the Ukrainian border.

At 15:31 GMT, March E-mini S&P 500 Index futures are trading 4442.25, up 48.25 or +1.10%. The S&P 500 Trust ETF (SPY) is trading $444.93, up $5.91 or +1.35%.

In response to the new development, airline and cruise stocks led the gainers while energy companies were the biggest losers as oil prices fell. American Airlines rose 5% and Carnival Corp. added more than 4.5%. Meanwhile, Exxon Mobile fell 2% and Conoco Phillips lost 3%.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. A trade through 4586.00 will change the main trend to up. A move through 4354.00 will signal a resumption of the downtrend.

The index is currently trading on the strong side of a longer-term retracement zone at 4419.25 to 4327.50, making it support. This zone stopped the selling on Monday at 4354.00. This is followed by another major retracement zone at 4266.00 to 4137.50.

The minor range is 4586.00 to 4354.00. Its 50% level at 4470.00 is potential resistance.

The short-term range is 4808.25 to 4212.75. Its retracement zone at 4510.50 to 4580.75 is the best resistance area. It stopped two rallies recently at 4585.00 and 4586.00.

Daily Swing Chart Technical Forecast

The early price action suggests the direction of the March E-mini S&P 500 Index into the close on Tuesday will be determined by trader reaction to 4419.25.

Bullish Scenario

Look for the counter-trend buying to continue as long as the index holds 4419.25. If this is able to generate enough upside momentum then look for the rally to extend into 4510.50.

Look for sellers on the first test of 4510.50. Overtaking it could trigger an acceleration into 4580.75, followed by 4585.00 – 4586.00.

Bearish Scenario

A sustained move under 4419.25 will signal the presence of sellers. This could lead to a retest of the minor bottom at 4354.00, followed by the retracement zone at 4327.50 to 4266.00.