E-mini Dow Jones Industrial Average (YM) Futures Analysis – Major RT Support Zone 25233 to 24824

E-mini Dow Jones Industrial Average futures are edging higher early Wednesday after posting a tumultuous trading session on Tuesday. Early in yesterday’s session the Dow plunged over 500 points in reaction to earnings misses by 3M and Caterpillar. Later, it was able to recover most of those losses fueled by aggressive counter-trend buyers looking for value. Investors stopped the price slide by rotating into defensive stocks like McDonald’s, Procter & Gamble or basically S&P 500 consumer staples sector stocks.

At 0357 GMT, December E-mini Dow Jones Industrial Average futures are trading 25247, up 3 or +0.02%.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. The downtrend was reaffirmed on Tuesday when sellers took out the previous main bottom at 24893. A trade through 24750 will indicate the selling is getting stronger. This has the potential to trigger an acceleration to the downside with 24000 the next major downside target.

The main trend will change to up on a move through 25845. The next major target over this top is 26966.

The major support is the retracement zone at 25233 to 24824. Sellers took out the lower or Fibonacci level of this zone on Tuesday, but buyers quickly came in to stop the price slide.

The short-term range is 25845 to 24750. Its retracement zone at 25298 to 25427 is the primary upside target. Since the main trend is down, sellers are likely to come in on the first test of this zone.

The main range is 26966 to 24750. If buyers can take out 25427 then look for a potential rally into its retracement zone at 25858 to 26119.

The key area to watch is a combination of the 50% levels at 25233 to 25298. This area is controlling the near-term direction of the Dow.

Daily Swing Chart Technical Forecast

Based on Tuesday’s close at 25244 and the earlier price action, the direction of the December E-mini Dow Jones Industrial Average futures market will be determined by trader reaction to the major 50% level at 25233.

Bullish Scenario

A sustained move over 25233 will signal the presence of buyers. The initial move will be labored because of potential resistance at 25298 and 25427. The buying will begin to strengthen over 25427 with the next targets 25845 to 25858.

Bearish Scenario

A sustained move under 25233 will indicate the presence of sellers. If this move creates enough downside momentum then look for a potential break into the major Fibonacci level at 24824, followed by yesterday’s low at 24750.

Taking out 24750 could trigger an acceleration to the downside with the next target the June 28 main bottom at 24000.