E-mini Dow Jones Industrial Average (YM) Futures Technical Analysis – May Be Grinding Toward 26962

June E-mini Dow Jones Industrial Average futures are inching higher early Wednesday as optimism over reopening businesses overshadowed fears of more disruptions from protests in the United States over race. Optimism over the prospects of a post-pandemic economic recovery also outweighed worries over an ongoing standoff between Washington and Beijing.

At 07:16 GMT, June E-mini Dow Jones Industrial Average futures are trading 25842, up 141 or +0.55%.

The trade in the Dow on Tuesday indicates that there is a rotation going on in the markets as traders added more risk to their portfolios with securities that have been beaten up and should benefit as the economy recovers. Basically, there is a battle between growth and value for leadership in the market.

Cyclical stocks like financials and industrials gave the biggest lift to the Dow. Energy stocks also shared the lead. Bank of America rose 0.93%, Citigroup and Wells Fargo advanced 2.81% and 1.14%, respectively. Meanwhile, shares of tech giants Facebook, Amazon, Apple and Microsoft were relatively flat.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. The uptrend was reaffirmed early Wednesday when buyers took out the previous top at 25794. The trend will change to down when the swing bottom at 22704 is violated.

The minor trend is also up. The minor trend will change to down on a move through 24991. This will also shift momentum to the downside.

The main range is 29506 to 18086. Its retracement zone at 25144 to 23796 is controlling the longer-term direction of the Dow. The main Fibonacci level at 25144 is the nearest support.

Daily Swing Chart Technical Forecast

The direction of the June E-mini Dow Jones Industrial Average futures contract on Wednesday is likely to be determined by trader reaction to yesterday’s close at 25701.

Bullish Scenario

A sustained move over 25701 will indicate the presence of buyers. If the buying volume continues to press the market higher then look for a move into the March 3 main top at 26962 over the near-term.

Bearish Scenario

A sustained move under 25701 will signal the presence of sellers. If confirmed on the daily chart, this could trigger the start of a 2 to 3 day correction with the nearest targets 25144 and 24991.