E-mini Dow Jones Industrial Average (YM) Futures Analysis – August 24, 2016 Forecast

September E-mini Dow Jones Industrial Average futures finished higher on Tuesday, but well off their high. Early in the session, the Dow spiked to 18615, but sellers came in to stop the rally from taking out the previous main top at 18623. This also reflects a divergence between the Dow and the other major indices which posted new contract highs.

The price action is also a good example of investor indecision. Volume is thin this week ahead of Fed Chair Janet Yellen’s speech on Friday. The major players are on the sidelines because of uncertainty over the direction of U.S. interest rates so at best, we can expect to see a two-sided trade since no one really wants to commit to one side or the other.

Technically, the main trend is up according to the daily swing chart. A trade through 18623 will signal a resumption of the uptrend while a move through 18442 will turn the main trend to down.

The main range is 18170 to 18623. Its retracement zone at 18397 to 18343 is a major downside target should there be a sell-off.

The short-term range is 18623 to 18442. Its 50% level or pivot is the key number to watch today. Trader reaction to this level will set the tone for the day.

Because of the thin-trading conditions, we expect to see the Dow straddle 18533 most of the session. This sideways action should set up a volatile move later in the week.