E-mini Dow Jones Industrial Average (YM) Futures Technical Analysis – Weak Under 26162, Strong Over 26714
December E-mini Dow Jones Industrial Average futures are on pace to close sharply lower on Wednesday as investors reacted to concerns over the latest increase in COVID-19 infections and its potential impact on the global economy.
U.S. coronavirus cases have risen by a record daily average of 71,832 over the past week, data compiled by Johns Hopkins University showed. Meanwhile, coronavirus-related hospitalizations are up 5% or more in three dozen states, according to data from the COVID Tracking Project. Cases are also rising sharply across Europe.
At 20:53 GMT, December E-mini Dow Jones Industrial Average futures are trading 26457, down 908 or -3.32%.
Dow components Microsoft and Boeing were in the news. Microsoft reported better-than-expected earnings and revenue for the previous quarter as sales from its cloud business grew sharply. However, the stock dropped 5% on light revenue guidance.
Boeing reported a quarterly loss that’s narrower than expected, but the company said it plans to cut thousands of additional jobs through 2021 as it adjusts to the long-term drop in air travel demand. Boeing shares dropped 4.6%.
Daily Swing Chart Technical Analysis
The main trend is down according to the daily swing chart. The trend turned down when sellers took out the last swing bottom at 26407.
The main range is 24377 to 29050. The Dow is going to close inside its retracement zone at 26714 to 26162. Trader reaction to this zone will determine the near-term direction of the blue-chip average.
The next major move in the December E-mini Dow Jones Industrial Average will be determined by trader reaction to the 50% level at 26714 and the Fibonacci level at 26162.
A sustained move under 26162 will indicate the selling pressure is getting stronger. This could trigger a break into the next main bottom at 25777. If this fails then look for the selling to possibly extend into the next level at 25210. Another potential downside target is 24716. This is the last potential bottom before the June 15 main bottom at 24377.
A sustained move over 26714 will signal the return of buyers. This could trigger a short-covering rally.
For a look at all of today’s economic events, check out our economic calendar.