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James Hyerczyk
E-mini Dow Jones Industrial Average

December E-mini Dow Jones Industrial Average futures are steady shortly after the cash market opening. A divergence between the cash and futures markets are helping to hold prices in a tight range. Stock futures sold off sharply on Wednesday after the cash market closed, creating the divergence. Traders are also reluctant to take a position ahead of a key economic release at 14:00 GMT that could set the tone of the session.

At 13:42 GMT, December E-mini Dow Jones Industrial Average futures are trading 25998, up 13 or +0.05%.

Look for volatility at 14:00 GMT following the release of the ISM Non-Manufacturing PMI report. It’s expected to come in at 55.1, down from the previously reported 56.4. Earlier in the week, a weaker-than-expected ISM Manufacturing PMI report for September came in well-below expectations, contributing to this week’s steep sell-off.

Daily December E-mini Dow Jones Industrial Average

Daily Technical Analysis

The main trend is down according to the daily swing chart. The market is not in a position to change the main trend to up, but due to the prolonged move down in terms of price and time, it is ripe for a closing price reversal bottom.

If formed then confirmed, a closing price reversal bottom could trigger a 2 to 3 day counter-trend rally.

The main range is 25014 to 27312. Its retracement zone at 26163 to 25892 is currently being tested.

The short-term range is 25244 to 27312. Its retracement zone is 26278 to 26034.


Daily Technical Forecast

Based on the early price action and the current price at 25998, the direction of the December E-mini Dow Jones Industrial Average futures contract the rest of the session on Thursday is likely to be determined by trader reaction to the short-term Fibonacci level at 26034.

Bearish Scenario

A sustained move under 26034 will indicate the presence of sellers. This could trigger a break into the main Fibonacci level at 25892.

If 25892 fails then look for the selling to extend into the uptrending Gann angle at 25670. This is a potential trigger point for an acceleration to the downside with the next target angle coming in at 25342.

Bullish Scenario

A sustained move over 26034 will signal the return of buyers. This could trigger a labored rally with resistance lined up at 26163, 26278, 26326 and a downtrending Gann angle at 26416.

The Gann angle at 26416 has guided the market lower since the 27312 main top on September 13.

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