E-mini S&P 500 Index (ES) Futures Technical Analysis – Close Under 4621.50 Forms Closing Price Reversal Top

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December E-mini S&P 500 Index futures are trading mixed shortly after the U.S. Federal Reserve released its monetary policy statement. Earlier in the session, the benchmark index hit another record high.

The Fed came across as more dovish than the market expected when it signaled it was in no rush to raise interest rates. The Fed also maintained its ‘transitory’ language regarding inflation, which signaled that rates would stay lower for longer than many are anticipating.

At 18:24 GMT, December E-mini S&P 500 Index futures are trading 4630.25, up 6.75 or +0.15%.

The Federal Reserve also revealed its plan to slow its asset purchases starting later this month. The central bank will decrease the current purchases by $15 billion per month in November and December. The Fed currently has been making roughly $120 billion in purchases per month.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. A trade through the intraday high at $4632.50 will signal a resumption of the uptrend.

A move through 4260.00 will change the main trend to down. This is highly unlikely, but the market is ripe for a closing price reversal top. This won’t change the main trend to down, but it could trigger the start of a 2 to 3 day correction.

The minor trend is also up. A trade through 4543.75 will change the minor trend to down. This will also shift momentum to the downside.

The nearest support is a 50% level at 4588.00. This level will move higher as the market up.

Daily Swing Chart Technical Forecast

The direction of the December E-mini S&P 500 Index into the close on Wednesday is likely to be determined by trader reaction to 4621.50.

Bullish Scenario

A sustained move over 4621.50 will indicate the presence of buyers. Taking out 4632.50 will indicate the buying is getting stronger. This could trigger an acceleration to the upside late in the session.

Bearish Scenario

A sustained move under 4621.50 will signal the presence of sellers. If this move creates enough downside momentum then look for the selling to possibly extend into 4588.00.

If 4588.00 fails as support then look for a possible acceleration into the minor bottom at 4543.75.

Side Notes

A close under 4621.50 will form a closing price reversal top on the daily chart.