E-mini Dow Jones Industrial Average (YM) Futures Technical Analysis – Trader Reaction to 34842 Sets the Tone

September E-mini Dow Jones Industrial Average futures are trading lower shortly after the cash market opening on Wednesday as concerns around slowing economic growth and renewed COVID-19 fears hit economically-sensitive sectors, including banks and industrials.

At 13:56 GMT, September E-mini Dow Jones Industrial Average futures are trading 34826, down 172 or -0.49%.

In stock related news, Amgen Inc is the biggest loser, off $5.845 or -2.40%. Walgreens is down $0.89 or -1.87%, despite reporting a surge in vaccinations. Lower oil prices are dragging Chevron Corp down. The stock is trading $100.71, down $1.89 or -1.84%. On the upside, Nike Inc is trading $171.78, up $0.55 or +0.32%.

In economic news, the ADP private payroll survey showed a gain of 330,000 jobs in July, well short of the consensus estimate of 653,000. The report comes ahead of the Labor Department’s official jobs report, which will be released on Friday, CNBC said.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart, however, momentum is trending lower, following the confirmation of Monday’s closing price reversal top.

A trade through 35082 will negate the closing price reversal top and signal a resumption of the uptrend. A move through 34602 will indicate the selling pressure is getting stronger.

The minor range is 35082 to 34602. The E-mini Dow is currently straddling its pivot at 34842.

The short-term range is 33623 to 35082. If sellers can take out 34602 with strong volume, the index Dow could collapse into 34353 to 34180.

Daily Swing Chart Technical Forecast

The direction of the September E-mini Dow Jones Industrial Average into the close is likely to be determined by trader reaction to 34842.

Bullish Scenario

A sustained move over 34842 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 35082. We’re not likely to see this, however, if the volume continues to come in below average.

Bearish Scenario

A sustained move under 34842 will signal the presence of sellers. The next potential downside target comes in at 34602. Taking out this level could trigger a further break into 34353 if there is strong selling volume.