E-mini Dow Jones Industrial Average (YM) Futures Technical Analysis – Posts Three Straight Reversal Tops

September E-mini Dow Jones Industrial Average futures posted a third consecutive closing price reversal top on Wednesday, which is a strong side that the selling may be greater than the buying at current price levels. What this market needs to confirm the chart pattern is strong follow-through selling.

A closing price reversal top is not a change in trend, but if confirmed, it could lead to a 2 to 3 day correction. However, it is possible that the trend changes to down during this phase of the chart pattern.

On Wednesday, the September E-mini Dow Jones Industrial Average futures contract settled at 35290, down 50 or -0.14%.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart, however, momentum may be getting ready to shift to the downside.

A trade through 35494 will negate the closing price reversal top and signal a resumption of the uptrend. The main trend will change to down on a trade through 35114.

A trade through 35269 will confirm Wednesday’s closing price reversal top. This will shift momentum to the downside and could trigger the start of a 2 to 3 day correction.

The minor range is 35114 to 35494. Yesterday, the Dow closed on the weak side of its pivot at 35304.

The short-term range is 34494 to 35494. If the main trend changes to down then look for the selling to possibly extend into its retracement zone at 34994 to 34876.

Daily Swing Chart Technical Forecast

The direction of the September E-mini Dow Jones Industrial Average on Thursday is likely to be determined by trader reaction to 35304.

Bearish Scenario

A sustained move under 35304 will indicate the presence of sellers. Taking out 35269 will confirm the closing price reversal top. This could trigger an acceleration to the downside with the next major target the main bottom at 35114.

Taking out 35114 will change the main trend to down. This could lead to a test of the retracement zone at 34994 to 34876.

Bullish Scenario

A sustained move over 35304 will signal the presence of buyers. If this is able to generate enough upside momentum then look for the buying to possibly lead to a retest of the closing price reversal top at 35494. Overtaking it could trigger a surge into the record high at 35547.