E-mini Dow Jones Industrial Average (YM) Futures Technical Analysis – Strengthens Over 27859, Weakens Under 27755

Based on the early price action and the current price at 27879, the direction of the December E-mini Dow Jones Industrial Average the rest of the session on Friday is likely to be determined by trader reaction to the short-term Fibonacci level at 27859.
James Hyerczyk
E-mini Dow Jones Industrial Average

December E-mini Dow Jones Industrial Average futures are expected to open higher based on the pre-market trade. The catalysts behind the early strength are optimism over a U.S.-China trade deal and a better-than-expected jump in U.S. non-farm payrolls.

Although the headline number soundly beat expectations, traders have to realize that some of those gains can be attributed to the ending of the General Motors automaker strike. Furthermore, although the unemployment rate fell to 3.5%, average hourly earnings came in lower than expected.

At 14:27 GMT, December E-mini Dow Jones Industrial Average futures are trading 27879, up 202 or +0.73%.

With the jobs report out of the way, the focus will shift back to the trade deal. Bullish investors continue to hope that a deal will be reached before December 15. That’s the day new tariffs against China are expected to kick-in.

Daily December E-mini Dow Jones Industrial Average

Daily Technical Analysis

The main trend is down according to the daily swing chart. A trade through 28197 will change the main trend to up. A move through 27312 will signal a resumption of the downtrend.

The short-term range is 28197 to 27312. Its retracement zone at 27755 to 27859 is controlling the near-term direction of the Dow. Trading on the strong side of this zone will help generate an upside bias.

On the downside, the support levels are labored at 27510, 27380 and 27193.

Daily Technical Forecast

Based on the early price action and the current price at 27879, the direction of the December E-mini Dow Jones Industrial Average the rest of the session on Friday is likely to be determined by trader reaction to the short-term Fibonacci level at 27859.

Bullish Scenario

A sustained move over 27859 will indicate the presence of buyers. The first upside target is a downtrending Gann angle at 27941. Since the main trend is down, look for sellers on the first test of this angle.

Overtaking 27941 could trigger a further rally into downtrending Gann angles at 28069 and 28133. The latter is the last potential resistance angle before the 28197 main top.

Bearish Scenario

A sustained move under 27859 will signal the presence of sellers. This could trigger a break into the 50% level at 27755. This is a potential trigger point for an acceleration to the downside with the first target coming in at 27510.

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