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James Hyerczyk
E-mini Dow Jones Industrial Average

March E-mini Dow Jones Industrial Average futures hit a record high on Monday and are on pace to finish higher for a fifth straight session. The catalyst behind today’s rally is the so-called “Phase One” trade deal between the United States and China, which greenlights the path for stocks to end the year with a strong rally.

At 15:02 GMT, March E-mini Dow Jones Industrial Average futures are trading 28324, up 159 or +0.57%.

Daily March E-mini Dow Jones Industrial Average

Daily Technical Analysis

The main trend is up according to the daily swing chart. The uptrend was reaffirmed earlier in the session when buyers took out Friday’s high at 28307.

The main trend will change to down on a trade through 27297. This is highly unlikely. However, since the market is up nine sessions since its last main bottom, it starts today’s session inside the window of time for a closing price reversal top.

This chart pattern won’t mean the trend is changing to down, but it will indicate the selling is greater than the buying at current price levels. If confirmed, it could also trigger the start of a 2 to 3 day correction.


Daily Technical Forecast

Based on the early price action and the current price at 28324, the direction of the March E-mini Dow Jones Industrial Average futures contract on Monday is likely to be determined by trader reaction to Friday’s close at 28165.

Bullish Scenario

A sustained move over 28165 will indicate the presence of buyers. If this move creates enough upside momentum then look for the rally to extend into the steep uptrending Gann angle at 28449.

Crossing to the strong side of the angle at 28449 will put the Dow in a bullish position.

Bearish Scenario

A sustained move under 28165 will signal the presence of sellers. This will also put the Dow in a position to form a potentially bearish closing price reversal top. If this move creates enough downside momentum then look for a possible break into the nearest uptrending Gann angle at 27873.

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