E-mini S&P 500 Index Eyeing Breakout Over 4530.50 Fib Level

June E-mini S&P 500 Index futures are edging higher shortly before the mid-session on Thursday as investors try to recover from Wednesday’s loss. The choppy trade this week suggests investors are being cautious over the war in Ukraine while assessing the potential impact of aggressive Federal Reserve rate hikes amid persistent inflation.

At 18:44 GMT, June E-mini S&P 500 Index futures are trading 4488.75, up 41.25 or +0.93%. The S&P 500 Trust ETF (SPY) is at $447.67, up $3.87 or +0.87%.

Regarding the war in Ukraine, NATO leaders met in Brussels Thursday to discuss increasing pressure on Russia, as Ukraine appears to be retaking ground in the war.

As far as the Fed is concerned, last week, policymakers raised interest rates for the first time since 2018. Chair Jerome Powell on Monday vowed to be tough on inflation and opened the door for more aggressive half-percentage-point rate hikes.

In other news, materials was the top performing S&P 500 sector. Mosaic and Freeport-McMoRan each added more than 3%.

Daily June E-mini S&P 500 Index

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. A trade through 4514.75 will signal a resumption of the uptrend.

A trade through 4129.50 will change the main trend to down. This is highly unlikely, but the prolonged move up in terms of price and time has put the index in a position to form a closing price reversal top.

The main range is 4800.00 to 4094.25. The index is currently testing its retracement zone at 4447.00 to 4530.50.

The short-term range is 4578.50 to 4094.25. Its retracement zone at 4393.50 to 4336.25 is potential support.

Short-Term Outlook

The direction of the June E-mini S&P 500 Index into the close on Thursday and early Friday will be determined by trader reaction to the main 50% level at 4447.00.

Bullish Scenario

A sustained move over 4447.25 will indicate the presence of buyers. If this generates enough upside momentum then look for a surge into 4514.75 to 4530.50. The latter is a potential trigger point for an acceleration to the upside.

Bearish Scenario

A sustained move under 4447.00 will signal the presence of sellers. This could trigger a sharply break into the short-term Fibonacci level at 4393.50, followed by the short-term 50% level at 4336.25.

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