E-mini Dow Jones Industrial Average (YM) Futures Analysis – Needs to Hold 23937 to Generate Momentum to Test 24923

The Dow closed lower last week, but made an impressive comeback on the weekly chart. The price action strongly indicates that buyers are still coming in on the dips, preventing a steep sell-off. At the same time, gains are being limited because these buyers seem to be reluctant to buy strength, which is needed to drive the Dow out of its nearly three month trading range.

Last week, the June E-mini Dow Jones Industrial Average futures contract settled at 24228, down 55 or -0.23%.

Weekly Swing Chart Technical Analysis

The main trend is up according to the weekly swing chart, however, momentum has been drifting sideways-to-lower since early February.

The minor trend is down, which supports the downtrending momentum. A trade though 24827 will change the minor trend to up and shift momentum to the upside. A trade through 23467, 23306 and 23122 will reaffirm the downtrend.

The price action is also being controlled by a pair of retracement zones. The support zone is 23937 to 23279. The resistance zone is 24923 to 25347.

Weekly Swing Chart Technical Forecast

Based on last week’s close at 24228 and last week’s price action, the direction of the Dow this week is likely to be determined by trader reaction to the 50% level at 23937.

A sustained move over 23937 will indicate the presence of buyers. If this move creates enough upside momentum, we could see a rally into the minor top at 24827 and the 50% level at 24923.

Overtaking 24923 will indicate the buying is getting stronger with the Fib level at 25347 the next target. This is the trigger point for an acceleration to the upside.

The inability to hold above 23937 will signal the return of sellers. This could generate the downside momentum needed to challenge the minor bottom at 23467, the minor bottom at 23306, the Fibonacci level at 23279 and the minor bottom at 23122.

The Weekly chart is wide open under 23122 with 21150 the next major downside target.