E-mini S&P 500 Index (ES) Futures Technical Analysis – Trading on Strong Side of Key Fibonacci Level
June E-mini S&P 500 Index futures are trading sharply higher shortly after the cash market opening on Monday. The benchmark index is trading on the strong side of a major technical barrier, adding to the upside momentum. Fundamentally, business restarts and optimism about a potential coronavirus vaccine is helping investors to overlook simmering U.S. – China tensions.
At 14:15 GMT, June E-mini S&P 500 Index futures are trading 3005.50, up 16.00 or +0.62%.
The S&P 500 has risen about 35% from its March lows on hopes of an eventual coronavirus antidote and easing of virus-related curbs. It is now about 13% below its all-time high hit more than three months ago.
Daily Swing Chart Technical Analysis
The main trend is up according to the daily swing chart. Now that the index has cleared its last main top at 2976.25, traders are setting their sights on the March 3 top at 3131.00. However, a trade through 2903.75 will change the main trend to down.
The main range is 3397.75 to 2174.00. Its retracement zone at 2930.25 to 2785.75 is controlling the longer-term direction of the index. Trading on the strong side of the retracement zone has put the index in a bullish position. Furthermore, the zone is now support.
Daily Swing Chart Technical Forecast
Based on the early price action, the direction of the June E-mini S&P 500 Index the rest of the session on Tuesday is likely to be determined by trader reaction to Friday’s close at 2989.50.
Bullish Scenario
A sustained move over 2989.50 will indicate the presence of buyers. If this move continues to generate enough upside momentum then watch for a potential acceleration to the upside with 3131.00 the next likely target.
Bearish Scenario
A sustained move under 2989.50 will signal the return of buyers. This will also put the index in a position to form a closing price reversal top. The first downside target is the main Fibonacci level at 2930.25, followed by the main bottom at 2903.75.
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This article was originally posted on FX Empire
