E-mini Dow Jones Industrial Average (YM) Futures Technical Analysis – Bullish as Long as 26727 Holds as Support

December E-mini Dow Jones Industrial Average futures surged on Tuesday in conjunction with a jump in the cash market on the opening. Stronger-than-expected corporate earnings reports earlier in the session were the catalysts behind the early strength.

J.P. Morgan Chase kicked off things with third-quarter numbers that topped analyst expectations. The company’s revenue also hit a record, boosted by home and auto loans along with credit cards. The news helped drive shares up more than 2%.

At 13:36 GMT, December E-mini Dow Jones Industrial Average futures are trading 26855, up 109 or +0.41%.

Shares of Johnson & Johnson were also up more than 2% after its third quarter numbers were lifted by higher sales of cancer and other prescription drugs. Shares of UnitedHealth, another Dow member, rose 2.9% after the company posted a quarterly profit that topped analyst expectations by 13 cents per share.

Daily Technical Analysis

The main trend is up according to the daily swing chart. A trade through 26975 will signal a resumption of the uptrend. The main trend will change to down on a move through 25983.

The Dow is posting an inside move for a second straight day. This suggests investor indecision and impending volatility. Bullish traders are hoping better-than-expected earnings news will offset worries over U.S.-China trade relations.

The short-term range is 27312 to 25703. Its retracement zone at 26697 to 26508 is support. The market is currently trading on the strong side of this zone, giving the market an early upside bias.

Daily Technical Forecast

Based on the early price action and the current price at 26855, the direction of the December E-mini Dow Jones Industrial Average futures contract the rest of the session on Tuesday is likely to be determined by trader reaction to the uptrending Gann angle at 26727.

Bullish Scenario

A sustained move over 26727 will indicate the presence of buyers. If this move can generate enough upside momentum then look for the rally to extend into the downtrending Gann angle at 26960, followed by last week’s high at 26975. Additional upside targets are minor tops at 27040 and 27112, followed by a downtrending Gann angle at 27136.

Bearish Scenario

A failure to hold and a sustained move under 26727 will signal the return of sellers. The first downside target is 26697. Look for a technical bounce on the first test of this level.

If 26697 fails as support then look for a potential acceleration to the downside with the next target the main 50% level at 26508.