E-mini Dow Jones Industrial Average (YM) Futures Analysis – May 2, 2016 Forecast

June E-mini Dow Jones Industrial Average futures are trading higher shortly before the cash market opening. The market is recovering from a sharp sell-off on Friday and a successful test of a major retracement zone.

The main trend is down according to the daily swing chart.

The main range is 17299 to 18083. Traders are trying to establish support at its retracement zone at 17691 to 17598.

The intermediate range is 17396 to 17083. Its retracement zone at 17839 to 17886 is an upside target today.

The short-term range is 18083 to 17568. It retracement zone at 17787 to 17839 is another upside target.

The two retracement zones combine to form a potential resistance area at 17826 to 17839.

Based on Friday’s close at 17693 and the early price action, the direction of the market today is likely to be determined by trader reaction to the main 50% level at 17691.

A sustained move under 17691 will signal the presence of sellers. This could trigger a steep break because the nearest support doesn’t come in until 17598. This is followed by the low at 17568 and the uptrending angle at 17507.

A sustained move over 17691 will indicate the presence of buyers. An early rally will be labored because of potential resistance angles at 17714 and 17715.

Overtaking 17715 could trigger an acceleration to the upside with the next target a short-term 50% level at 17787, a potential resistance cluster at 17826 to 17827, and a short-term Fib level at 17839.

The trigger point for an acceleration to the upside is 17839. This is followed by 17886. Taking out this level could also trigger breakout into 17955.

Watch the price action and read the order flow at 17691 today. Look for an upside bias on a sustained move over this level and an acceleration to the upside if 17715 is taken out with conviction.

Look for a downside bias if 17691 is taken out with conviction. This is also the trigger point for a steep sell-off.