E-mini Dow Jones Industrial Average (YM) Futures Technical Analysis – 27729 – 28040 is Next Upside Target

December E-mini Dow Jones Industrial Average futures are trading higher early Tuesday, building on newfound momentum after bargain hunters on Monday helped the blue chip average rebound from last week’s selloff.

Later today, investors will get the chance to react to U.S. consumer confidence and home price reports. Upcoming U.S. economic data should help show how well the country is positioned to rebound from pandemic lockdowns, and how necessary more stimulus will be.

At 03:58 GMT, December E-mini Dow Jones Industrial Average futures are at 27556, up 74 or +0.27%.

U.S. investors posted strong gains on Wall Street on Monday, particularly in hard-hit sectors like hotels, banks and airlines which posted sizeable gains after several days of decline.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart, but momentum is trending higher. Momentum shifted to the upside on September 25 when buyers confirmed the previous day’s closing price reversal bottom.

A trade through 26407 will negate the closing price reversal bottom and signal a resumption of the downtrend. The main trend changes to up on a move through 28251.

The main range is 24377 to 29050. Its retracement zone at 26714 to 26162 is support. This zone is controlling the near-term direction of the Dow. This area stopped the selling at 26407 on September 24.

The minor range is 28251 to 26407. The Dow is currently testing its retracement zone at 27329 to 27547.

The short-term range is 29050 to 26407. Its retracement zone at 27729 to 28040 is today’s upside target zone.

Daily Swing Chart Technical Forecast

The early price action on Tuesday indicates that investors are going to try to take out the minor Fibonacci level at 27547. This should trigger a surge into the short-term 50% level at 27729. Since the main trend is down, sellers are likely to come in on a test of this level.

Overtaking 27729 could create the upside momentum needed to challenge the short-term Fibonacci level at 28040, this is followed closely by the main top at 28251.

A break under 27329 will indicate the presence of sellers. This could trigger a break to about 26993. Counter-trend buyers may step in on a test of this level in an effort to create a secondary higher bottom. If 26993 fails as support then look for the selling to possibly extend into the main 50% level at 26714.