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E-mini Dow Jones Industrial Average (YM) Futures Technical Analysis – Weak Under 27339, Strong Over 27729

By:
James Hyerczyk
Published: Oct 27, 2020, 15:00 UTC

The direction of the December E-mini Dow Jones Industrial Average is likely to be determined by trader reaction to 27627 and 27729.

E-mini Dow Jones Industrial Average

In this article:

December E-mini Dow Jones Industrial Average futures are edging lower shortly after the opening on Tuesday after giving back earlier gains. The market is trading inside yesterday’s range on relatively low volume, suggesting investor indecision and impending volatility.

Despite the tight trading range, Wall Street’s fear gauge jumped on Tuesday after closing at its highest level in nearly two months on concerns about President Donald Trump’s unexpected victory or an uncertain election outcome.

At 14:22 GMT, December E-mini Dow Jones Industrial Average futures are trading 27477, down 104 or -0.38%.

Democratic challenger Joe Biden leads in national polls but the race is much tighter in battleground states which determine the election outcome.

In other news, Dow components 3M Co and Caterpillar Inc were flat to slightly lower after results.

Industrial conglomerate 3M Co posted a 4.5% rise in quarterly revenue on Tuesday, as demand for its healthcare products picked up during the COVID-19 pandemic.

Caterpillar Inc on Tuesday reported lower quarterly earnings as equipment sales fell across all of its three primary segments, reflecting a slow and uneven recovery in global economic activity from coronavirus lockdowns.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart, however, momentum is trending lower. The main trend will change to down on a trade through 26407. A move through 28846 will signal a resumption of the uptrend.

The minor trend is down. This is controlling the momentum. A trade through 27259 will indicate the selling is getting stronger. This could lead to a test of the two minor bottoms at 27109 and 27039.

The minor trend will change to up on a move through 28392. This will change the minor trend to up and shift the momentum back to the upside.

The short-term range is 29050 to 26407. Its retracement zone at 27729 to 28040 is resistance.

The minor range is 26407 to 28846. Its retracement zone at 27627 to 27339 is potential support. This zone is currently being tested.

Daily Swing Chart Technical Forecast

The current price action suggests the direction of the December E-mini Dow Jones Industrial Average on Tuesday is likely to be determined by trader reaction to a pair of 50% levels at 27627 and 27729.

Bearish Scenario

A sustained move under 27627 will indicate the presence of sellers. This could trigger a break into the Fibonacci level at 27339, followed by yesterday’s low at 27259 and a pair of minor bottoms at 27109 and 27039. The latter is a potential trigger point for an acceleration to the downside with a major 50% level at 26714 the next likely downside target.

Bullish Scenario

A sustained move over 27729 will indicate the return of buyers. This could trigger an acceleration to the upside with 28040 the next likely upside target.

For a look at all of today’s economic events, check out our economic calendar.

About the Author

James is a Florida-based technical analyst, market researcher, educator and trader with 35+ years of experience. He is an expert in the area of patterns, price and time analysis as it applies to futures, Forex, and stocks.

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