E-mini Dow Could Weaken Under 34932, Strenghten Over 35380

March E-mini Dow Jones Industrial Average futures are trading flat during Tuesday’s pre-market session after posting an inside day on Monday. The relatively low volume and inside trading range suggests investor indecision and impending volatility. The price action also suggests investors are worried about inflation, rising interest rates and upcoming earnings reports.

At 03:36 GMT, March E-mini Dow Jones Industrial Average futures are trading 34990, up 21 or +0.06%.

Stocks were mixed on Monday with Boeing, Chevron and American Express posting gains of 2.65%, 1.96% and 1.09%, respectively. The biggest losers were Microsoft, Merck & Co and Dow, Inc. They were down 1.63%, 1.25% and 1.14%, respectively.

The E-mini Dow is likely to continue to struggle with direction until the latest inflation figures are released on Thursday. The figures will help investors gauge how aggressive the Fed will tighten. The inflation data is expected to show that prices rose 0.4% in January, for a 7.2% gain from one year ago.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart, however, momentum is trending higher. A trade through 35590 will change the main trend to up. A move through 33031 will signal a resumption of the downtrend.

The minor trend is up. This is controlling the momentum. A trade through 33532 will change the minor trend to down.

The main range is 36832 to 33031. The E-mini Dow is currently testing its retracement zone at 34932 to 35380. Inside this range is a pivot at 35129.

The short-term range is 33031 to 35590. Its retracement zone at 34311 to 34009 is the next downside target zone.

The major support zone is 33461 to 32665. This zone stopped the selling at 33031 on January 24.

Daily Swing Chart Technical Forecast

The direction of the March E-mini Dow on Tuesday is likely to be determined by trader reaction to 35129.

Bearish Scenario

A sustained move under 35129 will indicate the presence of sellers. Taking out the 50% level at 34932 will indicate the selling is getting stronger with 34668 the next target.

If 34668 fails as support then look for the selling to possibly extend into the retracement zone at 34311 – 34009.

Bullish Scenario

A sustained move over 35129 will signal the presence of buyers. The first upside target is the Fibonacci level at 35380. Overcoming this level could trigger a surge into the main top at 35590.

A move through 35590 will change the main trend to up. This could trigger an acceleration to the upside with 36390 the next likely upside target.