E-mini Dow Jones Industrial Average (YM) Futures Technical Analysis – Main Trend Up, but Momentum Pointing Lower

Based on Friday’s price action, the key support for the December E-mini Dow Jones Industrial Average futures contract is the 50% level at 27733.
James Hyerczyk
E-mini Dow Jones Industrial Average

December E-mini Dow Jones Industrial Average futures are trading higher shortly before the futures close on Friday. Following a fast break mid-week, the Dow has consolidated for two days. However, the light volume still suggests investor indecision and impending volatility.

Stocks seemed to be supported on Friday by comments from President Trump on the trade deal with China. Trump told Fox News both sides were “very close” to reaching a trade agreement, noting:  We have a very good chance to make the deal.”

Gains were likely limited by comments from Chinese President Xi Jinping who said on Friday that Beijing wants to work for a trade deal with the U.S. but is not afraid to “fight back.” This suggests the two sides still have some issues to settle. Nonetheless, Xi also told a visiting U.S. business delegation that China holds a “positive attitude” toward the trade talks.

At 21:34 GMT, December E-mini Dow Jones Industrial Average futures are trading 27862, up 114 or +0.41%.

Daily December E-mini Dow Jones Industrial Average

Daily Technical Analysis

The main trend is up according to the daily swing chart, however, momentum shifted to the downside on November 19 with the formation of a closing price reversal top at 28128.

A trade through 28128 will negate the closing price reversal top and signal a resumption of the uptrend. The main trend will officially turn down on a move through 26588.

The minor trend is also up. It will change to down on a trade through 27337. This will confirm the shift in momentum to the downside.

The first minor range is 27337 to 28128. Its 50% level or pivot has been providing support the last three days.

Daily Technical Forecast

Based on Friday’s price action, the key support for the December E-mini Dow Jones Industrial Average futures contract is the 50% level at 27733.

Not only did the Dow find support at 27733 on Friday, but it also crossed to the strong side of a steep downtrending Gann angle at 27744. If the buying continues to strengthen then look for a potential rally into a series of downtrending Gann angles at 27936, 28032 and 28080.

Crossing to the bullish side of a steep uptrending Gann angle at 28007 will put the Dow in a strong position. This angle held as support since October 3 before it failed earlier this week.

A sustained move under 27733 will indicate the selling pressure is getting stronger. This could trigger the start of an acceleration to the downside.

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