ES danced around its 200-day moving average line most of the day before settling on a loss of seven points at the close yesterday. The upside momentum seems to be losing steam as more and more large corporations report missing their earnings estimates for the third quarter.

Based on the relatively weak closing price, ES could continue to have a small pullback move today. But the 2000 level will be the first short-term support to prevent the price from falling further … as long as it holds..

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A move below 1998.50 could lead the ES down to test the 20/40ema lines, but we will continue to see the buyers entering there.

We already saw some profit taking at the 2031.50 level Tuesday, and 2033-41.75 zone will continue to be an area where profit are taken and the upward momentum slows.

The upside movement for today will be limited due to some bearish divergence on the MACD indicator. Traders should focus on the short side if there is a rally up to the 2033-41.75 zone.

Outlook

Short-term === Bullish
MEDIUM TERM === Neutral
LONG-TERM === Bullish

Support and resistance

The major support levels: 2005-03.75, 1992.5-87.50, 1950-56,1928-29.50;
the major resistance levels: 2035.50-32, 2042-40.50, 2050-46.50