E-mini S&P 500

E-mini S&P 500 (ES) Futures: Prices Consolidate Ahead of Central Bank Meetings

  • Investors are sitting on their hands ahead of the ECB and BoJ meetings.
  • Apple plans to slow hiring and spending growth next year.
  • On the charts, the price of ES oscillates between 3906.75 and 3746.25.

Today’s E-mini S&P 500 (ES) futures outlook is slightly bullish as investors grapple with indecision amid a few macroeconomic and political developments. Investors are not ready to take a stand as they await direction from significant upcoming events like the ECB meeting.

“Right now, it’s the cautious mode. It’s not necessarily plain defense and really being short on markets,” said Olivier Marciot, senior portfolio manager at Unigestion.

“Minimal exposures all over the place, and waiting for clearer direction to deploy risk.”

Prices fell yesterday after reports that Apple had plans to slow hiring and spending growth in the coming year to cope with a potential economic slowdown.

Investors are also on the sidelines awaiting Thursday’s central bank meetings in Europe and Japan, which might prompt them to pick a side.

“It’s a bit like ‘paint by numbers at the moment, you’ve got a picture to fill in, but we don’t have all the colors yet,” said Kerry Craig, global market strategist at JPMorgan Asset Management.

“There are a couple of things missing (such as) the direction of the labor market and unemployment rate in the US and whether central banks will step back and say ‘that’s the peak in inflation and we don’t need to be as hawkish,’ or ‘we’re going to be aggressive.”

E-mini S&P 500 (ES) futures technical outlook:

E-mini S&P 500 (ES) futures 4-hour chart
E-mini S&P 500 (ES) futures 4-hour chart

The 4-hour chart shows the price stuck in a range with resistance at 3906.75 and support at 3746.25. Looking closer into the range, we see the price bouncing to the upside off the 30-SMA; this is an indication that bulls are in control at the moment. This bullish sentiment can also be seen in the RSI, which trades above 50.

The price might retest resistance at 3906.75 and may attempt to break above it. It appears to be a battle between bears and bulls; until one wins, there will be no clear long-term direction. In the short term, however, the price will remain bullish if it keeps trading above the SMA and the RSI stays above 50.