E-mini Dow Jones Industrial Average (YM) Futures Analysis – August 1, 2016 Forecast

September E-mini Dow Jones Industrial Average futures are trading higher shortly before the cash market opening, but the market is coming off its high. Sellers are reacting to weaker-than-expected PMI data in China and volatile price action in the banking sector in Europe.

Today, U.S. traders will get the opportunity to react to the latest U.S. Manufacturing PMI data at 1345 GMT and ISM manufacturing and construction spending figures at 1400 GMT.

The main trend is up according to the daily swing chart, however, momentum has been sideways to lower since the 18565 top on July 20. A trade through 18565 will signal a resumption of the uptrend. A move through 18293 will signal increasing selling pressure.

The short-term range is 18565 to 18293. Its 50% level or pivot at 18429 appears to be controlling the short-term direction of the market.

Based on the earlier price action, trader reaction to 18437 will set the tone for the day on Monday. The inability to overcome this angle indicates the presence of sellers. A move under 18429 will indicate the selling is getting stronger.

The daily chart is open to the downside under 18429 with the next target a downtrending angle at 18309. This is followed by the low at 18293. This price is the trigger point for an acceleration into the longer-term uptrending angle at 18194.

Crossing to the strong side of the downtrending angle at 18437 will signal the presence of buyers. This could create enough upside momentum to challenge the pair of angles at 18501 and 18561. The latter is the last potential resistance angle before the 18565 main top.

Look for the downside bias to continue on a sustained move under 18429 and for the Dow to strengthen on a sustained move over 18437.