E-mini Dow Jones Industrial Average (YM) Futures Technical Analysis – Ready to Strike Next Main Top at 34011

September E-mini Dow Jones Industrial Average futures are trading sharply higher late in the session on Friday. The catalysts behind the rally are expectations of a less-aggressive pace of future interest rate hikes starting in September. Softer-than-expected consumer and producer inflation data earlier in the week sparked the current buying spree.

At 18:58 GMT, September E-mini Dow Jones Industrial Average futures are trading 33634, up 330 or +0.99%. The SPDR Dow Jones industrial Average ETF is at $337.81, up $4.10 or +1.23%.

Also driving optimism was data showing U.S. consumer sentiment ticked further up in August from a record low this summer and American households’ near-term outlook for inflation eased again on softening gasoline prices.

In stock related news, the banking sector is up about 1.4% to extend their rally for a sixth straight week. Dow components JPMorgan Chase & Co and Goldman Sachs Group Inc are up 1.66% and 0.61% respectively. Walt Disney and Merck & Co are in a position to post the largest gains for the session.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. The trade through 33625 signaled a resumption of the uptrend. A move through the next main top at 34011 will reaffirm the uptrend. The main trend will change to down on a trade through 32342.

The main range is 35405 to 29639. The market is trading on the strong side of its retracement zone at 33202 to 32522, making it the support that is controlling the near-term direction of the market.

Short-Term Outlook

Trader reaction to 33456 is likely to determine the direction of the September E-mini Dow Jones Industrial Average into the close on Friday.

Bullish Scenario

A sustained move over 33456 will indicate the presence of buyers. If this move generates enough upside momentum then look for a surge into the May 5 main top at 34011. This is a potential trigger point for an acceleration to the upside.

Bearish Scenario

A sustained move under 33456 will signal the presence of sellers. If this move creates enough downside momentum then look for a break into the main Fibonacci level at 33202. This is a potential trigger point for an acceleration into the main 50% level at 33522.