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James Hyerczyk
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E-mini Dow Jones Industrial Average

Rising tensions over U.S.-China trade relations and new worries about a slowdown in the U.S. economy weighed on the blue chip Dow Jones Industrial Average on Thursday.

China stepped up its rhetoric towards the U.S. while more companies suspended business with Chinese telecom giant Huawei. Shares of Apple, a Dow component, fell 1.9% after a UBS analyst cut his price target on the iPhone maker to $225 per share from $235.

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The U.S. manufacturing PMI was 50.6 in May, the lowest since September 2009, according to HIS Markit. The company also said that U.S. overall business activity growth also faltered to a three-year low.

At 20:15 GMT, June E-mini Dow Jones Industrial Average futures are trading 25460, down 311 or 1.21%.

Daily June E-mini Dow Jones Industrial Average

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. A trade through 25215 will signal a resumption of the downtrend. This is followed by the February 8 main bottom at 24900.

Look for a potential acceleration to the downside if 24900 is taken out with strong selling volume.

The minor trend is also down. A trade though 25955 will change the minor trend to up. This will also shift momentum to the upside.

The main range is 21550 to 26694. If the downside momentum is strong enough to take out 24900 with conviction then its retracement zone at 24122 to 23515 will become the primary upside target.

On the upside, retracement levels are lined up at 25585, 25797, 25955 and 26129, forming a solid wall of resistance. This means that any rally is likely to be labored until buyers take out 26129.

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Daily Swing Chart Technical Forecast

Look for the downside pressure to continue as long as the June E-mini Dow Jones Industrial Average remains under 25585. Look for the selling to pick-up steam if 25215 fails. Look for an acceleration to the downside if 24900 is taken out.

Overtaking 25585 won’t mean the trend is changing, but we could see a labored rally over the short-term.

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