E-mini Dow Jones Industrial Average (YM) Futures Analysis – Extremely Vulnerable to Downside Under 23209

December E-mini Dow Jones Industrial Average futures finished lower last week after confirming the previous week’s potentially bearish closing price reversal top. It’s hard to predict if we’ll have a follow-through to the downside this week because it is a holiday-shortened week. Volume may come in well-below average which could lead to a rangebound trade or volatile two-sided price swings.

Weekly Technical Analysis

The main trend is up according to the weekly swing chart. However, the closing price reversal top from the week-ending November 10 has shifted momentum to the downside.

A trade through 23557 will negate the closing price reversal top and signal a resumption of the uptrend.

A move through 23205 will indicate the selling pressure is getting stronger.

The main range is 21545 to 23557. If the downside momentum continues we could see another 1 to 2 weeks of selling pressure. This could lead to an eventual test of its retracement zone at 22551 to 22314.

Weekly Technical Forecast

Based on last week’s close at 23316 and the price action, the direction of the Dow this week will be determined by trader reaction to the downtrending angle at 23301.

A sustained move over 23301 will indicate the presence of buyers. This could trigger a rally into a pair of downtrending angles at 23429 and 23493. The latter is the last potential resistance angle at 23557.

A sustained move under 23301 will signal the presence of sellers. The first downside target is a long-term uptrending Gann angle at 23209. This angle is very important because it has been guiding the market higher for 13 weeks.

A failure to hold 23209 could trigger an acceleration to the downside. The weekly chart opens up to the downside under this angle with the next major target the 50% level at 22551.

Be careful buying strength and selling weakness because of the light holiday volume.