E-mini Dow Jones Industrial Average (YM) Futures Analysis – May 15, 2018 Forecast
June E-mini Dow Jones Industrial Average futures are trading lower shortly after the opening. The weakness is being fueled by another rise in U.S. Treasury yields.
Daily Swing Chart Technical Analysis
The main trend is up according to the daily swing chart. A trade through 24971 will signal a resumption of the uptrend.
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We didn’t get a closing price reversal top on Monday, but we were in the 7 to 10 day period from a bottom which usually leads to the start of 2 to 3 day corrections. Volatility also fell during the rally so we expected to see it expand again.
Additionally, the Dow was approaching a major 50% to 61.8% zone at 24923 to 25347, which is hard to take out during the midst of a seven day rally. In other words, the market may have to break in order to attract enough new buyers to drive it through the major zone.
On the upside, the resistance is 24867, 24923 and 24971. The latter is the trigger point for an acceleration to the upside.
On the downside, retracement levels at 24684, 24569 and 24421 could provide support.
The short-term range is 23467 to 24971. Its retracement zone at 24219 to 24042 is the primary downside target.
Daily Swing Chart Technical Forecast
Based on the early price action, the direction of the Dow today is likely to be determined by trader reaction to the Fibonacci level at 24684.
A sustained move over 24684 will indicate the presence of buyers. This could create the upside momentum needed to challenge a cluster of levels between 24867 and 24971.
Taking out 24684 and sustaining the move will signal increased selling pressure. This could lead to a labored break with targets coming in a 24569 and 24421.
Since the trend is up, we’re likely to see new buyers come in on a test of 24219 to 24042. This is our objective on this break.