E-mini Dow Jones Industrial Average (YM) Futures Technical Analysis – Up as US Mulls Lifting China Tariffs

June E-mini Dow Jones Industrial Average futures are creeping higher early Monday despite Friday’s stronger-than-expected U.S. Non-Farm Payrolls report that signaled the Fed will continue to tighten monetary policy aggressively to combat surging inflation.

At 07:35 GMT, the June E-mini Dow is trading 33072, up 184 or +0.56%. On Friday, the SPDR Dow Jones Industrial Average ETF (DIA) settled at $329.38, down $3.39 or -1.02%.

According to Reuters, sentiment is getting a boost from comments by U.S. Commerce Secretary Gina Raimondo that President Joe Biden has asked his team to look at the option of lifting some tariffs on China.

Looking ahead, investors will be eyeballing this week’s U.S. consumer price report, due to be released on Friday. Forecasts are for a steep rise of 0.7% in May, though the annual pace is seen holding 8.3% while core inflation is seen slowing a little to 5.9%.

A high number could be bearish for stocks because it would add to expectations of aggressive tightening by the Federal Reserve with markets already priced for half-point increases in June and July, and almost 200 basis points by the end of the year.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. A trade through 33434 will reaffirm the uptrend. A move through 32491 will change the main trend to down.

The minor range is 33434 to 32491. The market is currently straddling its pivot at 32963.

On the upside, the nearest resistance is the main retracement zone at 33647 to 34369.

The short-term range is 30585 to 33434. If the main trend changes to down then look for the selling to continue into its retracement zone at 32010 to 31673.

Daily Swing Chart Technical Forecast

Trader reaction to the pivot at 32963 is likely to determine the direction of the June E-mini Dow Jones Industrial Average early Monday.

Bullish Scenario

A sustained move over 32963 will indicate the presence of buyers. If this move creates enough upside momentum then look for buyers to make a run at 33434.

Taking out 33434 will reaffirm the uptrend with the main 50% level at 33647 the next target. Sellers could come in on the first test of this level. However, overcoming it could trigger a surge into another main top at 34027, followed by the main Fibonacci level at 34369.

Bearish Scenario

A sustained move under 32963 will signal the presence of sellers. If this generates enough downside momentum then look for the selling to possibly extend into the main bottom at 32491.

A trade through 34291 will change the main trend to down. This could trigger a further break into the short-term retracement zone at 32010 to 31673. Look for counter-trend buyers to return on a test of this area. They are going to try to form a potentially bullish secondary higher bottom.