E-mini Dow Jones Industrial Average (YM) Futures Analysis – Downside Momentum Could Build into Close

The Dow retreated from its high following the release of the Fed rate hike and monetary policy statement. Volatility is relatively low, however. Nonetheless, if the downside momentum continues, the market is likely to finish lower for the session.

At 1910 GMT, December E-mini Dow Jones Industrial Average futures are trading 26542, up 22 or +-.08%. The market is coming down from a high of 26627. The low for the session is 26516.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. A trade through 26820 will signal a resumption of the uptrend. Taking out 26501 will indicate the selling pressure is getting stronger. The main trend changes to down on a trade through 25991.

The current short-term range is 26820 to 26501. Its 50% level or pivot at 26601 is controlling the direction of the Dow today. Holding below this pivot is helping to give the market a downside bias.

The intermediate range is 25991 to 26820. Its 50% level or pivot at 26406 is the next downside target. Since the trend is up, we could see a technical bounce on the first test of this level.

If 26406 fails as support then look for the selling to extend into the major retracement zone at 26302 to 26180. This is the major zone that has to hold or the index will be in danger of changing the main trend to down.

Daily Swing Chart Technical Forecast

Based on the current price and Wednesday’s price action, the direction of the December E-mini S&P 500 Index into the close is likely to be determined by trader reaction to the pivot at 26661.

A sustained move under 26661 will indicate that sellers are in control. If the selling pressure persists then look for 26501 to fail. This should trigger a break into 26406. The best support zone is 26302 to 26180. Look for buyers to come in on a test of this zone.

Overcoming and sustaining a rally late in the session over 26661 will signal the return of buyers. This could create the upside momentum needed to challenge or even take out 26820.

If investors are looking for value then they are going to wait for a test of 26302 to 26180 before re-entering on the long side.