E-mini Dow Jones Industrial Average (YM) Futures Technical Analysis – Straddling 27801 for Fifth Session

September E-mini Dow Jones Industrial Average futures are called higher on Tuesday with components Home Depot and Walmart providing most of the support. If you’re keeping score, this is retailers’ week, which means earnings season is coming to an end.

Traders are looking for major retailers to gauge the American Consumer’s resilience against the COVID-19 pandemic in the second quarter. Their reports will close out a better-than-feared earnings season.

At 13:06 GMT, September E-mini Dow Jones Industrial Average futures are trading 27814, up 39 or +0.14%.

The home improvement chain Home Depot rose 2.8% in premarket trade, setting it up for a rally into a new all-time high, after its quarterly comparable same-store sales were much better than expected, as people focused on home repair while staying indoors.

Walmart shares jumped 5.5% in premarket trading. The retailer’s earnings and revenue topped Wall Street estimates last quarter as same-store sales increased by 9.3%. E-commerce sales nearly doubled.

Another Dow component, Boeing, said it plans to offer voluntary layoffs to employees for the second time this year, according to a note written by CEO Dave Calhoun to Boeing workers. The jet maker did not set a specific reduction target, but is realigning its workforce to deal with the virus-induced drop in travel demand.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. A trade through 28069 will signal a resumption of the uptrend. The main trend will change to down on a move through the nearest swing bottom at 25881.

The minor trend is also up, but momentum has slowed since the formation of the closing price reversal top at 28069 on August 11. A trade through 27532 will confirm the chart pattern. It won’t change the trend to down, but it could trigger the start of a 2 to 3 day correction.

The market has been trading inside the range formed on August 11 for the last five sessions. The range is 28069 to 27532. Its 50% level at 27801 has been controlling the direction of the Dow.

The next minor range is 25881 to 28069. If the closing price reversal top is confirmed by a break through 27532 then look for a potential break into its retracement zone at 26975 to 26717. Since the main trend is up, buyers are likely to come in on a test of this area.

Daily Swing Chart Technical Forecast

Based on the price action over the past five sessions, once again, the direction of the September E-mini Dow Jones Industrial Average on Tuesday is likely to be determined by trader reaction to the 50% level at 27801.

Bullish Scenario

A sustained move over 27801 will indicate the presence of buyers. If this move can finally create enough upside momentum then look for a test of 28069. Taking out this level will negate the closing price reversal top and could trigger an acceleration to the upside if there is enough volume behind the move.

Bearish Scenario

A sustained move under 27801 will signal the presence of sellers. This could lead to a test of 27532. Taking out this level will confirm the closing price reversal top. This could trigger the start of a two to three day correction with 26975 the minimum downside target.