E-mini Dow Jones Industrial Average (YM) Futures Analysis – Trader Reaction to 22282 Will Set the Tone Today

December E-mini Dow Jones Industrial Average futures are trading higher without much fanfare on Tuesday. The price action looks like a knee-jerk reaction to yesterday’s sharp break and to reduced tensions over North Korea.

Daily Technical Analysis

The main trend is up according to the daily swing chart. This makes the Dow the strongest of the major indexes with both the S&P 500 Index and NASDAQ Composite in down trends.

Short-term momentum will shift to down on a sustained move under the short-term pivot at 22282. A trade through 22174 will indicate the selling is getting stronger. A move through 22389 will signal a resumption of the uptrend and make 22174 a new main bottom.

There is no resistance over 22389, but if 22174 fails then the selling may extend into a previous main top at 22089 then the main retracement zone at 21972 to 21874.

Daily Forecast

Based on the early price action, the direction of the Dow today is likely to be determined by trader reaction to the short-term pivot at 22282.

A sustained move over 22282 could drive the market into a pair of downtrending angles at 22325 and 22357. The latter is the last potential resistance angle before the 22389 main top.

A sustained move under 22282 will indicate the return of sellers. Crossing to the weak side of the downtrending angle at 22261 will signal that that the selling is getting stronger.

The major downside targets today are a loose support cluster formed by yesterday’s low at 22174 and the long-term uptrending angle at 22163.

The daily chart begins to open up to the downside under 22163 with 22089 the next target, followed by 221972.

Watch the price action and read the order flow at 22282 all session. Trader reaction to this pivot will tell us if the buyers are retaking control, or if the sellers are exerting more pressure.