E-mini Dow Jones Industrial Average (YM) Futures Technical Analysis – Trying to Build Support Base Over 25498

March E-mini Dow Jones Industrial Average futures are trading mixed shortly before the cash market after a volatile pre-market session indicated a lack of clarity on the coronavirus impact and as investors dealt with the rumor of a coordinated rate cut as early as Wednesday by the major central banks.

At 14:12 GMT, March E-mini Dow Jones Industrial Average futures are trading 25573, up 209 or +0.84%.

After last week’s steep sell-off put the Dow into correction territory, investors have been trying to form a bottom, driven by dovish comments from Federal Reserve Chairman Jerome Powell. He said the fundamentals of the U.S. economy remained strong and that the central bank will act as appropriate to provide support. Investors read this to mean the Fed would cut rates as soon as its March 17-18 policy meeting.

Daily Technical Analysis

The main trend is down according to the daily swing chart. The market is in no position to change the main trend to up, but there is room for a short-term retracement. A trade through 24675 will signal a resumption of the downtrend.

The major range is 21452 to 29543. Its retracement zone at 25498 to 24543 is major support. This zone stopped the selling at 24675 on Friday. Today, the market is trying to establish support inside this zone.

The minor range is 29543 to 24675. Its retracement zone at 27109 to 27683 is the primary upside target.

Daily Technical Forecast

Based on the early price action and the current price at 25573, the direction of the March E-mini Dow Jones Industrial Average the rest of the session on Monday is likely to be determined by trader reaction to the main 50% level at 25498.

Bullish Scenario

A sustained move over 25498 will indicate the presence of buyers. If this move can create enough upside momentum then look for the rally to possibly extend into the downtrending Gann angle at 26727. Look for sellers on the first test of this angle.

Taking out 26727 could trigger a surge into the 50% level at 27109. Look for sellers again. Overcoming 27109 could trigger a further rally into the Fib level at 27683, followed by a downtrending Gann angle at 28135.

Bearish Scenario

A sustained move under 25498 will signal the presence of sellers. This could lead to a retest of Friday’s low at 24675, followed closely by the major Fibonacci level at 24543.

The Fib level at 24543 is a potential trigger point for an acceleration to the downside. The two major downside target possibilities are 22563 and 21452.