E-mini Dow Strengthens Over 33357, Weakens Under 33198

June E-mini Dow Jones Industrial Average futures are edging higher shortly before the U.S. Federal Reserve is scheduled to release its monetary policy and interest rate decisions on Wednesday. Helping to put a cap on gains are a rise in U.S. Treasury yields and a widely expected interest-rate hike by the Fed that could be the biggest since 2000.

At 17:09 GMT, June E-mini Dow Jones Industrial Average futures are trading 33161, up 128 or +0.39%. The SPDR Dow Jones Industrial Average ETF (DIA) is at $332.33, up $1.08 or +0.33%.

Federal Reserve On-Tap

The Federal Reserve will release its policy statement at 18:00 GMT. Fed policymakers have widely telegraphed a double-barreled decision that would lift the Fed’s short-term target policy rate to a range between 0.75% and 1%, and set in motion a plan to trim its $9 trillion balance sheet.

Keep an Eye on Bank Stocks

Bank stocks were up 0.3% after U.S. Treasury two-year yields, the most sensitive to the Federal Reserve’s interest rate outlook, soared to their highest since November 2018. The benchmark 10-year yield topped 3% for a third consecutive day.

In response to the widely expected rate hike, Dow bank stock JPMorgan Chase & Co is up 1.12%. Other financial related stocks to watch include Goldman Sachs Group, American Express and Visa.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart, however, momentum has been trending higher since Monday. A trade through 35413 will change the main trend to up. A move through 32358 will signal a resumption of the downtrend.

The minor trend is also down. A trade through 33968 will change the minor trend to up. This will confirm the shift in momentum.

The minor range is 34038 to 32358. Its pivot at 33198 is the nearest resistance. It is followed by a short-term Fibonacci level at 33357. Overtaking this price could trigger an acceleration into a resistance cluster at 33750 to 33886.

Daily Swing Chart Technical Forecast

The direction of the June E-mini Dow into the close on Wednesday will be determined by trader reaction to 33198 and 33357.

Bearish Scenario

A sustained move under 33198 will indicate the presence of sellers. If this move creates enough downside momentum then look for a break into 32806. If this level fails then look for a retest of 32358.

Bullish Scenario

A sustained move over 33357 will signal the presence of buyers. This could trigger an acceleration to the upside with the next target area the resistance cluster at 33750 – 33886.

Side Notes

I’m leaning toward “Sell the Rumor, Buy the Fact”. Unless Fed Chair Powell is extremely hawkish in his post-announcement speech.