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

June E-mini Dow Jones Industrial Average futures are trading higher shortly before the cash market opening. The market is consolidating for a third day while straddling a short-term pivot price. The chart pattern suggests the market is preparing to surge to the upside.

Technically, the main trend is down according to the daily swing chart. A trade through 17720 will turn the main trend to up. A move through 17297 will signal a resumption of the downtrend.

The short-term range is 17720 to 17297. Its 50% price or pivot comes in at 17509. This price appears to be controlling the short-term direction of the market.

The main range is 17864 to 17297. Its retracement zone at 17580 to 17647 is the primary upside target. Since the trend is down, sellers may show up on a test of this zone.

Based on yesterday’s close at 17470 and the early price action, the direction of the market today is likely to be determined by trader reaction to the pivot at 17509.

A sustained move over 17509 will indicate the presence of buyers. This could create enough upside momentum to challenge the downtrending angle at 17544. This price is the trigger point for a breakout into the 50% level at 17580.

Look for sellers on the initial test of 17580, but if strong buyers come in, we could see an acceleration into the Fibonacci level at 17647.

The Fib level at 17647 is also the launching point for a strong rally with the next target a pair of downtrending angles at 17683 and 17704. This is followed by the main top at 17704. Taking out this area could trigger a huge rally since there isn’t any resistance until 17864.

The inability to overcome 17509 will indicate the presence of sellers. Breaking back under the uptrending angle at 17489 will indicate the selling is getting stronger. The daily chart is open under 17489 with the next targets coming in at 17393, 17345 and 17321.

Watch the price action and read the order flow at 17509 all session. Trader reaction to this price will determine the tone of the day.