E-mini Dow Jones Industrial Average (YM) Futures Technical Analysis – Reaction to 34751 Pivot Sets the Tone

September E-mini Dow Jones Industrial Average futures are trading lower during the pre-market session but the market remained just below its record high at 34883. The price action suggests investors are being a little cautious ahead of the start of earnings season on Tuesday, and the release of key U.S. economic reports on consumer inflation and retail sales.

At 04:30 GMT, September E-mini Dow Jones Industrial Average futures are trading 34697, down 54 or -0.16%.

Dow components JPMorgan Chase and Goldman Sachs kick off earnings season with results due before the bell on Tuesday. UnitedHealth posts results on Thursday.

The blue chip Dow popped on Friday with the cash market hitting a record high as stocks tied to the economic recovery that fell the previous session logged gains. This included Goldman Sachs, which jumped more than 3%.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. The uptrend was reaffirmed earlier in the session when buyers inched through Friday’s high at 34784. A trade through 34004 will change the main trend to down.

The minor range is 34004 to 34796. Its 50% level at 34400 is the nearest support.

The short-term range is 32902 to 34796. If the main trend changes to down then its retracement zone at 33849 to 33626 will become the primary downside target area.

Daily Swing Chart Technical Forecast

The early price action suggests the direction of the September E-mini Dow Jones Industrial Average on Monday is likely to be determined by trader reaction to 34751.

Bullish Scenario

A sustained move over 34751 will indicate the presence of buyers. If this move creates enough upside momentum then look for the rally to possibly extend into the record high at 34883. This is a potential trigger point for an acceleration to the upside since there is no true resistance.

Bearish Scenario

A sustained move under 34751 will signal the presence of sellers. If this move generates enough downside momentum then look for the move to possibly extend into the minor pivot at 34400. Since the main trend is up, buyers are likely to come in on the first test of this level.

Side Notes

A close under 34751 will form a potentially bearish closing price reversal top. It won’t change the main trend to down, but it could trigger the start of a minimum 2 to 3 day correction. The nearest potential downside targets are the main bottom at 34004 and the short-term 50% level at 33849.