E-mini Dow Jones Industrial Average (YM) Futures Analysis – October 6, 2014 Forecast
December E-mini Dow Jones Industrial Average futures surged on Friday. The strong close may give the market enough upside momentum to continue the rally on Monday, but the buying has to be strong enough to take out a major retracement zone to sustain the move.
The main trend is down on the daily chart. The main range is 17279 to 16589. Its retracement zone at 16934 to 17016 is the best upside target. The lower or 50% level at 16934 was tested on Friday, but there was barely the expected technical bounce, which suggests the bias is still to the upside.
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The first downtrending angle drops in at 16927. This forms a tight resistance cluster with the 50% level at 16934. Trader reaction to this area will set the tone for the day.
A failure at 16927 to 16934 could set up a drive back to the nearest support at 16783.
A breakout over 16934 could trigger a rally into the Fibonacci level at 17016. This level is another potential resistance/breakout level with 17103 the next upside target.
Watch the price action and order flow at 16927 to 16934. This zone may be straddle several times today before traders pick a direction.