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James Hyerczyk
E-mini Dow Jones Industrial Average

March E-mini Dow Jones Industrial Average futures are trading lower on Monday shortly after the cash market opening. The market is attempting to claw back earlier losses. Sellers came in early in the session, but the pressure wasn’t strong enough to take out last week’s low.

Investors have been on heightened alert since Friday after a U.S. airstrike killed a high ranking Iranian military official. Iran has threatened to retaliate, and the U.S. has responded with threats of their own.

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Investors are bracing for increased volatility in the markets especially if Iran attacks the global oil supply. In the meantime, the oil sector is getting some support as well as shares of defense companies. Airlines and insurance shares are feeling downside pressure.

At 16:09 GMT, March E-mini Dow Jones Industrial Average futures are at 28533, down 69 or -0.25%.

Daily March E-mini Dow Jones Industrial Average

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. However, momentum has been trending lower since the formation of the closing price reversal top at 28893 on January 3.

A trade through 28341 will change the main trend to down. A move through 28893 will negate the closing price reversal top and signal a resumption of the uptrend.

The minor range is 28893 to 28351. Its 50% level or pivot at 28622 is the first upside target. This level is important to the structure of the market. Counter-trend traders are likely to come in on a test of this level in an effort to form a secondary lower top. Trend traders are going to try to take out this level in an effort to make 28351 a new main bottom.

The minor range is 27715 to 28893. Its retracement zone at 28304 to 28165 is the first support zone. The two lows at 28351 and 28341 show that buyers are respecting this zone.

The main range is 27297 to 28893. Its retracement zone at 28095 to 27907 is a major support area. It represents value. Buyers are likely to come in on a test of this area.


Daily Swing Chart Technical Forecast

Based on the intraday upside momentum, the first target today is a resistance cluster at 28622 to 28637. Sellers could come in on a test of this area.

Taking out 28637 will indicate the buying is getting stronger. Buyers are likely to run into additional resistance at 28705 and 28765.

Ultimately, trader reaction to 28622 will determine the near-term direction of the Dow.

If the selling pressure resumes then look for a test of 28351 and 28341, followed closely by a 50% level at 28304 and an uptrending Gann angle at 28259.

The selling pressure is likely to increase on a trade through 28259. The next two targets are 28165 and 28095.

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