E-mini Dow Jones Industrial Average (YM) Futures Technical Analysis – February 6, 2019 ForecastBased on the early price action, the direction of the index the rest of the session is likely to be determined by trader reaction to yesterday’s high at 25374.
March E-mini Dow Jones Industrial Average futures are drifting lower shortly after the cash market. Upside momentum died early in the session so now traders are likely to press the short-side. Trump’s speech last night failed to generate any upside momentum. Powell’s speech this evening may be driving the price action since he is expected to talk about monetary policy.
At 14:52 GMT, March E-mini Dow Jones Industrial Average futures are trading 25321, down 3 or -0.01%.
Daily Technical Analysis
The main trend is up according to the daily swing chart. Given the prolonged move up in terms of price and time, traders should start watching for signs of a top like a closing price reversal top. It his chart pattern is formed and confirmed then look for the start of a 2 to 3 day correction.
A trade through 25374 will signal a resumption of the uptrend. The main trend will change to down on a trade through 22563.
The minor trend is also up. The minor trend will change to down on a trade through 24924. This will also shift momentum to the downside.
The market is also trading on the strong side of a major retracement zone at 24890 to 24234. This zone is controlling the near-term direction of the market. Look for the upside bias to continue as long as the index holds this area. Traders should treat it like support.
Daily Technical Forecast
Based on the early price action, the direction of the index the rest of the session is likely to be determined by trader reaction to yesterday’s high at 25374.
A sustained move over 25374 will indicate the presence of buyers. If this move creates enough upside momentum then look for buyers to take a run at the major top at 26110. Depending on how the news breaks, we could see a spike to the upside or a slow, steady climb.
The inability to overtake 25374 will signal the presence of sellers. If this move generates enough downside momentum then look for a potential pullback into the major Fibonacci level at 24890.
Closing Price Reversal Top Scenario
Taking out 25374 then falling below yesterday’s close at 25324 will signal the start of a closing price reversal top. A close below this level will complete the move. It it’s confirmed on Thursday then look for the start of a 2 to 3 day correction.
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