E-mini Dow Jones Industrial Average (YM) Futures Technical Analysis – Threatening Last Week’s Close at 27130

September E-mini Dow Jones Industrial Average futures are trading higher, but relatively weak when compared to the benchmark S&P 500 Index and the technology-based NASDAQ Composite cash markets, both of which hit new all-time highs on Friday.

The problem is the mix of stocks in the Dow. Both the S&P and NASDAQ are being supported on Friday by strong performances in technology stocks – Alphabet (Google’s parent) and Twitter. While the Dow is catching a bid, the buying isn’t strong enough to propel it to a record high because it is underweighted in technology stocks.

At 19:54 GMT, September E-mini Dow Jones Industrial Average futures are trading 27183, up 87 or +0.32%.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. The trend turned down on Thursday when sellers took out the previous main bottom at 27057. There was very little follow-through to the downside, however, with the selling stopping at 27040. This suggests the weakness was generated by sell stops rather than aggressive shorting.

The main trend will change to up on a move through 27358. The trend will get stronger on a trade through the main top at 27397. Taking out 27040 will indicate the selling is getting stronger.

The short-term range is 27397 to 27057. It 50% level or pivot at 27227 is controlling the price action on Friday by providing resistance.

The second short-term range is 26657 to 27397. Its 50% level or pivot at 27027 is providing support and protecting against a steep sell-off.

The intermediate range is 26445 to 27397. If 27040 fails with rising selling volume behind the move, then look for a potential plunge into the main bottom at 26657 and the intermediate 50% level at 26647.

Daily Swing Chart Technical Forecast

Based on the price action late Friday and the current price at 27183, the close will be determined by momentum.

If upside momentum increases then look for buyers to make a run at 27227. This is also the trigger point for an acceleration to the upside.

If downside momentum decreases then look for sellers to take a shot at 27027. This is potentially bearish because it will mean the Dow has turned lower for the week. This could lead to increased selling pressure next week.

Overview

Keep an eye on 27130 into the close. This is last week’s close. Finishing under this level and diverging from the S&P 500 Index and the NASDAQ Composite Index, would be a bearish sign, in my opinion.