E-mini Dow Jones Industrial Average

E-mini Dow Jones Industrial Average (YM) Futures Technical Analysis – Next Downside Target 27660-27520

December E-mini Dow Jones Industrial Average futures posted a two-side trade on Wednesday before settling slightly higher. The Dow briefly jumped more than 1% in afternoon trading after the Fed in its policy statement kept rates near zero and promised to keep them near there until inflation is on track to “moderately exceed” the U.S. central bank’s 2% inflation target “for some time.”

On Wednesday, December E-mini Dow Jones Industrial Average futures settled at 27937, up 29 or +0.10%.

Gains were limited as components Apple Inc and Microsoft Corp fell between 0.5% and 1.3%.

Daily December 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 27068 will signal a resumption of the downtrend. The main trend will change to up on a move through 29050.

The minor trend is also down, but momentum did shift briefly to the upside when buyers took out 28071, confirming last week’s closing price reversal bottom.

The short-term range is 29050 to 27068. Its retracement zone at 28059 to 28293 stopped the rally at 28251.

The minor range is 27068 to 28251. Its retracement zone at 27660 to 27520 is the primary downside target.

Daily Swing Chart Technical Forecast

On Wednesday, December E-mini Dow Jones Industrial Average formed a minor closing price reversal top after testing a retracement zone. A trade through 27846 will confirm the potentially bearish chart pattern. This could lead to a 2 to 3 day correction with 27660 to 27520 the next potential downside target.

The sell-off following the test of 28059 to 28293 was expected. Since the main trend is down, sellers showed up on the test of the retracement zone. They are trying to form a potentially bearish secondary lower top.

The first downside target of the chart pattern is 27660 to 27520. Aggressive counter-trend buyers could show up on a test of this zone. They are going to try to form a potentially bullish secondary higher bottom. If successful, this could lead to a retest of 28059 to 28293.

If 28293 fails then we could see an acceleration to the downside with the main bottom at 27068 the next downside target. Taking out this level will signal a resumption of the downtrend.

On the upside, taking out 28293 could trigger an acceleration to the upside.

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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.