E-mini Dow Jones Industrial Average (YM) Futures Technical Analysis – Underpinned by Strong Retail Earnings

September E-mini Dow Jones Industrial Average futures are inching higher shortly after the cash market opening after earnings beats from key components Walmart and Home Depot.

Traders are also responding to impressive U.S. economic data that suggested the economy was still strong despite several supersized interest rate hikes by the Federal Reserve.

At 13:31 GMT, September E-mini Dow Jones Industrial Average futures are trading 33945, up 72 or +0.21%. The SPDR Dow Jones Industrial Average ETF (DIA) is at $340.09, up $0.72 or +0.21%.

Walmart, Home Depot Beat Earnings Forecasts

Shortly before the opening bell, Walmart and Home Depot reported earnings that beat analyst expectations. Walmart jumped 5% on the news and Home Depot gained 1.48%. Both companies also maintained their 2022 guidance. Target and Lowe’s will report quarterly results Wednesday.

US Industrial Production Up Sharply in July

U.S. industrial production jumped 0.6% in July, the Federal Reserve reported Tuesday. The gain was above Wall Street expectations of a 0.3% increase, according to a survey by The Wall Street Journal.

In a separate report, Capacity utilization rebounded to 80.3% in July from 79.9% in the prior month. Economists had forecast an 80.2% rate.

In other news, Building Permits beat expectations, but Housing Starts missed the mark.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. A trade through the May 5 main top at 34011 will reaffirm the uptrend.

A trade through 32342 will change the main trend to down. This is highly unlikely but the market is ripe for a potentially bearish closing price reversal top.

The main support is the retracement zone at 33202 to 32522.

Daily Swing Chart Technical Forecast

Trader reaction to 33873 is likely to determine the direction of the September E-mini Dow on Tuesday.

Bullish Scenario

A sustained move over 33873 will indicate the presence of buyers. Taking out the main top at 34011 could trigger an acceleration to the upside with the April 21 main top at 35405 the next major target.

Bearish Scenario

A sustained move under 33873 will signal the presence of sellers. If this creates enough downside momentum then look for the start of a pullback into the Fibonacci level at 33202. If this fails then look for the selling to possibly extend into 32522 over the near-term.

Side Notes

A close under 33873 will form a closing price reversal top. This won’t change the trend, but if confirmed, it could trigger the start of a 2 to 3 day correction.