E-mini Dow Jones Industrial Average

E-mini Dow Jones Industrial Average (YM) Futures Analysis – Expecting Volatile Two-Sided Trade, Ripe for Closing Price Reversal Bottom

March E-mini Dow Jones Industrial Average futures are trading higher during the pre-market session. The market is trading inside yesterday’s range which suggests investor indecision and impending volatility. Although the market finished lower on Tuesday, it also remained inside Monday’s wide trading range.

The indecision is being fueled by worries over the Fed’s interest rate and monetary policy decisions due to be released at 1900 GMT. The Fed is widely expected to raise its benchmark rate 25 basis points, but stock market investors are more concerned about what the Fed will have to say about the pace of future rate hikes.

At 0905 GMT, March E-mini Dow Jones Industrial Average futures are trading 23739, up 130 or +0.55%.

E-mini Dow Jones Industrial Average
Daily March E-mini Dow Jones Industrial Average

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. A trade through 24860 will change the main trend to up. A move through 23476 will signal a resumption of the downtrend with 23169 the next likely target.

Due to the prolonged move down in terms of price and time, traders should also prepare for a possible closing price reversal bottom. We expect to see a volatile two-sided trade after the Fed announcements and remarks by Fed Chair Jerome Powell.

The short-term range is 24860 to 23476. Its retracement zone at 24168 to 24331 is the first upside target.

The main range is 26110 to 23476. Its retracement zone at 24793 to 25104 is the next potential upside target. Inside this zone is the main top at 24860.

Daily Swing Chart Technical Forecast

Based on the price action the last two sessions, the direction of the March E-mini Dow Jones Industrial Average on Wednesday is likely to be determined by trader reaction to this week’s low at 23476.

Bullish Scenario

A sustained move over 23476 will indicate the presence of buyers. If this creates enough upside momentum then look for a rally into 24168 to 24331. Look for sellers on the first test of this zone.

Taking out 24331 will indicate the buying is getting stronger with the next upside target the main 50% level at 24793, the main top at 24860 and the main Fibonacci level at 25104.

Bearish Scenario

A sustained move under 23476 will signal the presence of sellers. This could trigger an acceleration to the downside with the first target 23169.

Closing Price Reversal Bottom Pattern

Taking out 23476 then recapturing yesterday’s close at 23609 will indicate the buying is greater than the selling at current price levels. This could trigger a strong intraday rally. A higher close will form a daily closing price reversal bottom. This could fuel the start of a 2 to 3 day counter-trend rally.

Published by

James Hyerczyk

James A. Hyerczyk has worked as a fundamental and technical financial market analyst since 1982. His technical work features the pattern, price and time analysis techniques of W.D. Gann.