E-mini S&P 500

December E-Mini S&P 500 Holds Above Key Support Levels

Posted Monday, November 23, 2020 by
Shain Vernier • 1 min read

U.S. stock index futures are on the march to open the week, led by an uptick in the December E-mini S&P 500. With only a few hours to go in the trading session, the DJIA DOW (+250), S&P 500 SPX (+13), and NASDAQ (+20) are all faring well. At this point, Q4 2020 looks to be a big one for equities and risk assets.

Today’s economic news has been positive. All of the Markit PMI (November) figures came in well above expectations, as did the Chicago Fed National Activity Index (Oct.). These are good signs and suggest that business is picking up. Also, today brought a collection of U.S. Treasury Auctions. There were a few items worthy of note:

Event                                              Actual         Previous

6-Month T-Bill Auction                  0.09%           0.10%

2-Year T-Note Auction                  0.165%         0.151%

The key takeaway here is that demand for longer-term issues fell for a number of reasons. Perhaps the greatest is optimism that a COVID-19 vaccine will control the pandemic in a matter of months, not years. Ultimately, we’ll see what happens. 

Today, bids have hit December E-mini S&P 500 futures in mass. Let’s dig into the daily technicals and see where this market stands.

December E-mini S&P 500 Futures Rally

After a robust open, December E-mini S&P 500 futures have pared gains. Values are back in the neighborhood of 3565.00 and trending south on the intraday charts.

December E-mini S&P 500 Futures (ES), Daily Chart
December E-mini S&P 500 Futures (ES), Daily Chart

Here are a couple of support levels to watch going into tomorrow’s session:

  • Support(1): 38% Current Wave, 3498.75
  • Support(2): Bollinger MP, 3500.50

Bottom Line: From a technical standpoint, 3500.00 is setting up to be solid downside support. Until elected, I’ll have buy orders in December E-mini S&P 500 from 3501.25. With an initial stop loss at 3494.25, this trade produces 50 ticks on a near-1:2 risk vs reward ratio.

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