E-mini Dow Jones Industrial Average (YM) Futures Analysis – January 24, 2017 Forecast

March E-mini Dow Jones Industrial Average futures are trading higher shortly before the cash market opening. After two days of consolidation, the market may be set up for a breakout to the upside. I don’t expect a major move since buyers will only be taking out a pair of highs, not a main top.

Technical Analysis

The main trend is down according to the daily swing chart. A trade through 19925 will signal a resumption of the uptrend. This is followed by the main top at 19933. A trade through 19607 will signal a resumption of the downtrend.

The short-term range is 19925 to 19607. Its 50% level or pivot is 19770. This price is controlling the short-term direction of the market.

The main range is 19001 to 19933. If there is a sharp sell-off then its retracement zone at 19467 to 19357 will become the primary downside target.

Forecast

Based on the current price at 19740, the first upside target is the downtrending angle at 19757. This is followed by the pivot at 19770.

Overtaking the pivot at 19770 could trigger an acceleration to the upside, but then the rally will become labored because of potential resistance angles at 19837, 19845 and 19881. The latter is the last potential resistance angle before the 19925 and 19933 main tops.

Watch the price action and read the order flow at 19757. Crossing to the strong side of this angle will give the market an upside bias. A sustained move under this angle will indicate that sellers are in control.

If there is a sharp break under 19607 and the selling volume increases then look for the break to extend into 19529. This is followed by 19467.