E-mini Dow Jones Industrial Average (YM) Futures Technical Analysis – Fed Delivers What It Said It Would

December E-mini Dow Jones Industrial Average futures moved higher on Wednesday after the Federal Reserve sent a less-hawkish message than the financial markets were expecting.

As expected, the Federal Reserve said it will begin trimming its monthly bond purchases in November with plans to end them in 2022. What the Fed didn’t do was announce a timetable for interest rate hikes. Instead, policymakers held to its belief that high inflation would prove “transitory” and likely not require a fast rise in interest rates.

At 20:32 GMT, December E-mini Dow Jones Industrial Average futures were trading 36022, up 84 or +0.23%.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. The uptrend was reaffirmed when buyers took out the previous day’s high. A move through the intraday high at 36066 will reaffirm the uptrend.

A move through 33984 will change the main trend to down. This is highly unlikely, but due to the prolonged move down in terms of price and time, the E-mini Dow is trading inside the window of time for a closing price reversal top. This won’t change the trend to down, but it could alleviate the upside pressure for a few days.

The minor trend is also up. A trade through 35383 will change the minor trend to down. This will also shift momentum to the downside.

The minor range is 35383 to 36066. Its 50% level at 35725 is the nearest support.

The next minor range is 33984 to 36066. If the minor trend changes to down then look for the selling to continue into its retracement zone at 35025 to 34779.

The short-term retracement zone support comes in at 34725 to 34408.

Short-Term Forecast

The Fed news is bullish because policymakers delivered exactly what it had telegraphed to Wall Street for weeks. Following a solid earnings season and limited COVID fears, it seems the only thing that could derail the rally would be problems with an overvalued market.

There is no resistance so the best sign of a short-term top will be a closing price reversal. Continue to look for higher-highs and higher-lows, but be ready to react if that pattern is accompanied by a lower close.