E-mini Dow Jones Industrial Average (YM) Futures Technical Analysis – Strong Over 33858, Weak Under 33651

June E-mini Dow Jones Industrial Average futures are drifting lower shortly before the U.S. cash market opening on Wednesday as investors assessed a number of earnings reports while bracing for the latest Federal Reserve policy announcement, due to be released at 18:00 GMT. Helping to put pressure on the Dow are two components:  Microsoft and Boeing.

At 13:15 GMT, June E-mini Dow Jones Industrial Average futures are trading 33824, down 59 or -0.17%.

Microsoft shares dipped about 2% in early trading even after the company topped analyst estimates. Microsoft had its largest revenue growth since 2018, thanks in part to gains in PC sales resulting from coronavirus-driven shortages last year.

Boeing lost about 1.2% in premarket trading. The company reported a loss of $1.53 per share, compared to a consensus forecast for a loss of $1.15 per share. Revenue was better than expected, although the jet maker said the global pandemic continues to challenge the overall market environment.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart, however, momentum is trending lower. A trade through 34144 will signal a resumption of the uptrend.

The main trend will change to down on a move through 31951. This is highly unlikely, but there is room for a normal 50% correction.

The first minor range is 34144 to 33572. The Dow is currently trading on the weak side of its 50% level at 33858.

The second minor range is 33157 to 34144. Its 50% level at 33651 is support.

The short-term range is 31951 to 34144. Its 50% level at 33048 is the primary downside target.

Daily Swing Chart Technical Forecast

The direction of the June E-mini Dow Jones Industrial Average futures contract on Wednesday is likely to be determined by trader reaction to 33858.

Bullish Scenario

A sustained move over 33858 will indicate the presence of buyers. If this move is able to generate enough upside momentum then look for the rally to possibly extend into the minor top at 34066, followed closely by the main top at 34144.

Bearish Scenario

A sustained move under 33858 will signal the presence of sellers. If this move creates enough downside momentum then look for the selling to possibly extend into the pivot at 33651, this is followed by the one-week low at 33572.

The low at 33572 is a potential trigger point for an acceleration to the downside with 33048 the next major downside target.

Side Notes

We’ve seen the current pattern before. It indicates impending volatility. Look for an upside bias on a sustained move over 33858, and a downside bias on a sustained move under 33651.