E-mini Dow Jones Industrial Average (YM) Futures Analysis – May 31, 2016 Forecast

June E-mini Dow Jones Industrial Average futures closed higher on Friday and with enough upside momentum to continue the rally on Tuesday when the market reopens following Monday’s U.S. Memorial Day holiday.

The main trend is up according to the daily swing chart. A trade over 17869 will continue the uptrend. The trend will turn down on a trade through 17297. Today is the seventh day up from the last bottom on May 19, putting the market in the “window of time” for a potentially bearish closing price reversal top.

The main range is 18083 to 17297. Its retracement zone is 17690 to 17783. Three consecutive closes over this zone confirms the upside bias. This zone should be considered support.

The short-term range is 17297 to 17869. Its retracement zone at 17583 to 17516 is the primary downside target.

Based on Friday’s close at 17849, the direction of the market today will be determined by trader reaction to the long-term downtrending angle at 17859. A sustained move over this angle could create enough upside momentum to challenge the next downtrending angle at 17971. This is the last potential resistance angle before the 18006 and 18083 main tops.

The inability to overcome the angle at 17859 will signal the presence of sellers. This could drive the market into the main Fib level at 17783. This is the trigger point for a possible acceleration to the downside with the next target the main 50% level at 17690. This is followed closely by the steep uptrending angle at 17745.

The angle at 17745 is very important to the structure of the market because it has provided guidance since the 17297 main bottom on May 19. Taking it out will signal a serious shift in investor sentiment.

Watch the price action and read the order flow at 17859 today. Trader reaction to this angle will tell us if investors are still buying at current price levels.

If buying strength, be careful because of the possibility of a closing price reversal top. This move could trap you. This move is likely to occur as we approach the contract high. Position-squaring ahead of the U.S. jobs report on Friday could also produce this chart pattern.