E-mini Dow Jones Industrial Average (YM) Futures Analysis – July 27, 2017 Forecast

September E-mini Dow Jones Industrial Average futures are trading higher shortly after the opening. Everyone saw this coming because the blue chip market was trading firm in the pre-market session. The rally actually began yesterday after the close when Facebook’s results blew away the estimates.

Today’s price action will be dictated by momentum and news. With the Fed providing cheap money and earnings continuing to beat the estimates, investors really have no choice but to pour money into stocks.

The volatility index (VIX) is also at an all-time low. This means that investors are signaling they have no worries. The contrarian in me is telling me that something very bad is going to happen to set these aggressive buyers straight, but the trend trader is saying stay with it while the money is cheap.

Basically, the market will keep going up as long as investors continue to buy strength. And it will come down when investors decide they want to buy value instead.

The definition of an uptrend is a series of higher tops and higher bottoms. So we are definitely in an uptrend.

There is no resistance, but experience tells me when this current leg up ends, it will do so with a closing price reversal top. Therefore, we’re going to say that the direction of the Dow today will be determined by trader reaction to yesterday’s close at 21646. Basically, stay long as long as the Dow continues to produce higher highs, but become a cautious investor if 21646 fails as support and the market turns lower.