The S&P 500 E-Mini Futures (ES) have hit new all-time highs, confirming a strong upward trend that began from a low on November 21, 2025. This rise consists of a five-wave diagonal pattern, which is common in strong markets according to Elliott Wave theory. Wave ((i)) peaked at 6975.25, then a zigzag correction occurred in wave ((ii)). In this phase, wave (a) ended at 6817.5, wave (b) at 6882.50, and wave (c) finished at 6771.75, marking an important support level. After wave ((ii)), the index surged in wave ((iii)). Wave (i) reached 6872, while wave (ii) dipped to 6857.5. Wave (iii) climbed to 6990, after which it consolidated in wave (iv) at 6974, and wave (v) pushed up to 6994, finishing wave ((iii)). A corrective wave ((iv)) concluded at 6936, suggesting a possible continuation of the upward trend.

Potential Upside Targets

If the support at 6771.75 holds, pullbacks should show support through a 3, 7, or 11 swing sequence. Potential upside targets based on the external retracement levels from wave ((iv)) are between 7007 and 7029. This indicates that gains could continue if corrective patterns remain stable. The S&P 500 E-Mini futures appear set to maintain their bullish momentum into the new year after reaching those fresh all-time highs. This upward trend is supported by a technical structure that began with the November 21 low. Recent economic data further bolsters this outlook, making dips good opportunities for long positions. Looking back at the recent quarter, the November 2025 Consumer Price Index report revealed that core inflation has eased to 2.5%, reducing worries about aggressive rate hikes. With the Federal Reserve taking a more data-driven approach for 2026, market sentiment has improved. This economic environment aligns well with the ongoing ‘Santa Claus Rally’ we are currently experiencing.

Trading Strategies and Support Levels

With this positive outlook, traders might consider buying call options or selling out-of-the-money put credit spreads to take advantage of further gains. The key support to monitor is at 6771.75; if this level is breached, our immediate bullish view would be invalidated. Until then, any weakness should be viewed as a potential buying opportunity. The CBOE Volatility Index (VIX) is currently around 13, showing low levels of market anxiety and supporting the case for a continued, steady rise. Our upside targets are set in the range of 7007 to 7029 over the next few weeks. Traders should remain disciplined, as pullbacks to recent support levels like 6936 can still occur even in strong trends. Create your live VT Markets account and start trading now.

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