E-mini S&P 500 Index (ES) Futures Technical Analysis – Downside Pressure Targets 4382.75 – 4361.75

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December E-mini S&P 500 Index futures are expected to open sharply lower based on the pre-market trade. Driving the benchmark index lower is a plunge in technology shares.

Technology heavyweights are being pressured by a surge in bond yields on expectations of higher interest rates and rising inflation.

At 13:10 GMT, December E-mini S&P 500 Index futures are trading 4401.25, down 31.75 or -0.72%.

In stock related news, shares of Google-parent Alphabet Inc, Microsoft Corp, Amazon.com Inc, Apple, Tesla Inc and Facebook Inc dropped about 1.5% in premarket trading. These stocks have benefited from the low-interest rate environment since the start of the pandemic.

Helping to slow down the decline is the S&P Energy Sector, which is up about 10.4% in September, and is on track to break a two-month losing streak.

Daily December E-mini S&P 500 Index

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. A trade through 4293.75 will signal a resumption of the downtrend. A move through 4539.50 will change the main trend to up.

The minor trend is also down. A trade through 4472.00 will change the minor trend to up. This will also shift momentum to the upside.

The short-term range is 4539.50 to 4293.75. The index is currently trading on the weak side of its retracement zone at 4416.75 to 4445.75, making it resistance.

The minor range is 4293.75 to 4472.00. Its retracement zone at 4382.75 to 4361.75 is the next downside target.

The major support zone is 4328.25 to 4278.50. This zone stopped the selling at 4293.75 on September 20.

Daily Swing Chart Technical Forecast

The direction of the December E-mini S&P 500 Index on Tuesday is likely to be determined by trader reaction to 4416.75.

Bearish Scenario

A sustained move under 4416.75 will indicate the presence of sellers. The first downside target is the minor 50% level at 4382.75. If this level fails then look for the selling to extend into the minor Fibonacci level at 4361.75.

Aggressive counter-trend buyers could come in on a test of 4382.75 to 4361.75. They are going to try to form a secondary higher bottom. But if 4361.75 fails as support then look for the selling to possibly extend into 4328.25 to 4278.50.

Bullish Scenario

A sustained move over 4416.75 will signal the presence of buyers. The first upside target is 4445.75. Since the main trend is down, sellers could come in at 4416.75 to 4445.75. They are trying to form a potentially bearish secondary lower top.

Taking out 4445.75 will indicate the buying is getting stronger. This could trigger a surge into the minor top at 4472.00.

Overtaking 4472.00 could trigger an acceleration to the upside with 4539.50 the next major upside target.

For a look at all of today’s economic events, check out our economic calendar.

This article was originally posted on FX Empire