Based on the early price action, the direction of the March E-mini S&P 500 Index the rest of the session is likely to be determined by trader reaction to the downtrending Gann angle at 24156.
Volatility is the theme of the day so far in the March E-mini Dow Jones Industrial Average futures market. The Dow was under pressure early in the session after J.P. Morgan Chase released weaker-than-expected earnings. A sharp bounce in tech-related shares then erased those losses, driving the Dow to its high for the day. However, renewed concerns over U.S.-China trade relations drove the market down from its high.
At 1547 GMT, March E-mini Dow Jones Industrial Average futures are trading 23917, up 50 or 0.22%. Its high of the day is 24068.
The main trend is up according to the daily swing chart. The next upside target is the main top at 24860. The main trend will change to down on a trade through 22563.
The index is currently up seven sessions from the last main bottom at 22563. This puts the index inside the window of time for a potentially bearish closing price reversal top.
The minor trend is also up. It will change to down on a trade through 23640. This will also shift momentum to the downside.
Based on the early price action, the direction of the March E-mini S&P 500 Index the rest of the session is likely to be determined by trader reaction to the downtrending Gann angle at 24156.
Taking out and sustaining a rally over 24156 will indicate the presence of buyers. This could create the upside momentum needed to challenge the next downtrending Gann angle at 24508. This is the last potential resistance angle before the 24860 main top.
A sustained move under 24156 will signal the presence of sellers. The first downside target is a minor bottom at 23640. Taking out this level will change the minor trend to down and shift momentum to the downside.
If 23640 fails as support then look for the selling to extend into the main Fibonacci level at 23558. This is the trigger point for a potentially bearish break into a support cluster at 23459 to 23452. Look for a technical bounce on the first test of this support cluster.
If 23452 fails as support then look for the selling to extend into another support cluster at 23156 to 23116.
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.