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James Hyerczyk

June E-mini Dow Jones Industrial Average futures are trading flat shortly after the cash market opening. The limited movement is being fueled by a clash between investors betting on a successful reopening of the economy and those concerned about a resurgence in coronavirus cases and further damage to the economy.

At 14:11 GMT, June E-mini Dow Jones Industrial Average futures are at 23738, down 23 or -0.10%.

Traders showed limited reaction to a report from ADP and Moody’s Analytics that showed private payrolls were cut by 20.2 million last month. Although the report was devastating, short-term traders noted it was still better than the 22 million job losses predicted in a Dow Jones Survey, while long-term investors said they know this is temporary and that many of those jobs will get restored.

Daily June E-mini Dow Jones Industrial Average

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart, however, momentum has been trending lower since the formation of the closing price reversal top on April 30.

A trade through 24792 will negate the closing price reversal top and signal a resumption of the uptrend. The main trend will change to down on a move through the last main bottom at 22914.

The minor trend is also up. A trade through 23208 will change the minor trend to down. This will confirm the shift in momentum to down.

On the upside, the resistance is the 23796 to 25144 retracement zone. This area is also controlling the longer-term direction of the Dow. On the downside, the support zone is 23571 to 22524.

Combining the two retracement zone creates a price cluster at 23796 to 23571. The market has been straddling this zone the last four sessions.

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Daily Swing Chart Technical Forecast

Based on the early price action, the direction of the June E-mini Dow Jones Industrial Average the rest of the session on Wednesday will be determined by trader reaction to the 50% level at 23796 and the 61.8% level at 23571.

Bullish Scenario

A sustained move over 23796 will indicate the presence of buyers. The first upside target is a minor pivot at 24000. Overcoming this level could trigger a retest of the main top at 24792.

Bearish Scenario

A sustained move under 23571 will signal the presence of sellers. This could trigger a break into the minor bottom at 23208. This is a potential trigger point for an acceleration into the main bottom at 22914, followed by a 50% level at 22524.

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