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E-mini Dow Jones Industrial Average (YM) Futures Technical Analysis – Intraday Strength Develops Over 25633, Weakness Continues Under 25590

By:
James Hyerczyk
Published: May 9, 2019, 14:50 UTC

Intraday, look for a possible upside bias to begin on a sustained move over 25633 and for the downside momentum to continue on a sustained move under 25590.

E-mini Dow Jones Industrial Average

Sellers continue to pound the blue chip Dow Jones Industrial Average on Thursday. With the U.S.-China trade deal in serious doubt, investors are taking back the premium they had built into the market in anticipated of a trade agreement. The catalyst behind today’s move is a comment from President Donald Trump. He said at a rally on Wednesday that China “broke the deal”.

Chinese negotiators are in Washington and instead of talking trade, they are going to try to stop the White House from imposing additional tariffs on Chinese imports.

At 14:30 GMT, June Dow Jones Industrial Average futures are trading 25565, down 449 or -1.75%.

E-mini Dow Jones Industrial Average
Daily June E-mini Dow Jones Industrial Average

Daily Technical Analysis

The main trend is down according to the daily swing chart. Today’s steep sell-off has put the market in a position to challenge a minor bottom at 25441 and a main bottom at 25377. This is followed by another main bottom at 25246.

The nearest minor top is 26518 and the nearest main top is 26694. Traders are unlikely to take out these levels to shift momentum and the trend to up, but due to the prolonged move down in terms of price and time, the market is in the window of time for a closing price reversal bottom.

Since we’re in a momentum driven market, support is not that important, it’s pattern. Therefore, at this point, a closing price reversal bottom is the only chart pattern that will stop this price slide.

The main range is 25246 to 26694. Its retracement zone at 25799 to 25970 is resistance. Buyers are going to have to overcome this zone in order to generate any new upside momentum.

Daily Technical Forecast

Given the current downside momentum, the next target is an uptrending Gann angle at 25505. This is followed by a minor bottom at 25441, another uptrending Gann angle at 25418 and a main bottom at 25377.

If 25377 fails then look for the selling to continue into the March 8 bottom at 25246. The daily chart is wide open under this bottom, so don’t be surprised by an acceleration to the downside.

On the upside, overcoming the uptrending Gann angles at 25590 and 25633 will signal the return of buyers. If the move can create enough upside momentum then look for the buying to possibly extend into the Fibonacci level at 25799.

Overcoming 25799 will indicate the buying is getting stronger. This could trigger a further spike to the upside with potential targets coming in at 25889, 25934 and a resistance cluster at 25970 to 25990.

Overtaking 25990 will put the market in a bullish position with the possibility of an acceleration to the upside.

At 14:45 GMT, look for a possible upside bias to begin on a sustained move over 25633 and for the downside momentum to continue on a sustained move under 25590.

About the Author

James is a Florida-based technical analyst, market researcher, educator and trader with 35+ years of experience. He is an expert in the area of patterns, price and time analysis as it applies to futures, Forex, and stocks.

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