E-mini Dow Jones Industrial Average (YM) Futures Technical Analysis – Remains On Track for Drive into 25652

June E-mini Dow Jones Industrial Average futures are grinding higher shortly after the mid-session and before the close. The rally is being powered by a combination of short-covering and aggressive speculative buying as investors continue to increase bets that the Federal Reserve will trim interest rates sooner than expected.

On Tuesday, the Dow put in its best one-day performance in months after Fed Chair Jerome Powell hinted the central bank could be more accommodative with monetary policy if the trade dispute continues to weaken the economy.

At 18:43 GMT, June E-mini Dow Jones Industrial Average futures are trading 25528, up 182 or +0.72%.

Daily Technical Analysis

The main trend is down according to the daily swing chart. However, momentum shifted to the upside on Monday with the formation of a closing price reversal bottom. The Dow is in no position to change the main trend to up, but there is room for a normal 50% to 61.8% retracement.

A trade through 24610 will negate the closing price reversal bottom and signal a resumption of the downtrend.

The main range is 26694 to 24610. Its retracement zone at 25652 to 25898 is the first upside target. This zone is controlling the near-term direction of the futures contract. Since the main trend is down, we’re looking for sellers to show up on a test of this zone. They are going to try to form a secondary lower top.

On the downside, the best support remains the long-term 50% level at 24122.

Daily Technical Forecast

Today’s rally is being driven by strong upside momentum. If this momentum continues into the close then look for a potential drive into the 50% level at 25652, followed closely by a downtrending Gann angle at 25766.

If the rally stalls, momentum may shift to the downside. Turning lower for the session will signal the return of sellers. This could trigger a further decline into the steep uptrending Gann angle at 25122.