E-mini Dow Jones Industrial Average (YM) Futures Technical Analysis – Reaction to 33858 Sets the Early Tone

June E-mini Dow Jones Industrial Average futures closed higher on Friday, rebounding from losses the previous session as investors assessed the impact of a planned capital gains tax hike, with many pointing to reasons why such a policy alone would be unlikely to threaten the rally in equities.

On Friday, June E-mini Dow Jones Industrial Average futures settled at 33941, up 232 or +0.68%.

The Dow also bounced back after a drop in shares of American Express and Honeywell dragged down the blue-chip average early in the session. Earnings on the day were lackluster, with American Express Co sliding 3.4% after reporting a slump in credit spending and lower quarterly revenue. Honeywell International fell 2.7% after it missed revenue estimates for its aerospace division, its biggest business segment.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart, however, momentum is trending lower. A trade through 34144 will signal a resumption of the uptrend. This move will make 33572 a new main bottom.

A trade through the current main bottom at 31951 will change the main trend to down.

The minor trend is down. This is controlling the momentum. A trade through 33572 will indicate the selling pressure is getting stronger. The minor trend will change to up on a trade through 34066.

The first minor range is 34144 to 33572. On Friday, the Dow closed on the strong side of its pivot at 33858.

The second minor range is 33157 to 34144. Its 50% level or pivot at 33651 has provided support the last four days.

The short-term range is 31951 to 34144. If the selling pressure continues then look for the selling to possibly extend into its 50% level at 33048.

Short-Term Outlook

The price action on Friday and the close over 33858 suggests we could see an early upside bias on Monday. If this creates enough upside momentum then look for a drive into 34066 then 34144.

If 33858 fails then look for the selling to possibly extend into 33651. Taking out this level could create the downside momentum to take out the minor bottom at 33572. This is a potential trigger point for an acceleration to the downside with 33048 the next potential downside target.

For a look at all of today’s economic events, check out our economic calendar.