Dow Jones

E-mini Dow Jones Industrial Average (YM) Futures Technical Analysis – Potential for Steep Break Under 30233

March E-mini Dow Jones Industrial Average futures finished lower on Friday with Dow component JPMorgan Chase & Co weighing on prices and weakness in Exxon Mobil Corp dragging down constituent Chevron.

JPMorgan Chase on Friday beat analysts’ estimates for fourth-quarter profit on record trading results and a boost from releasing money previously set aside for loan losses. The sell-off was part of a price slide in the banking sector, led by weakness in Wells Fargo and Citigroup.

Shares of Exxon slipped more than 5% on Friday after The Wall Street Journal reported that the Securities and Exchange Commission opened an investigation that the Securities and Exchange Commission opened an investigation into the oil giant over how it valued a key asset in the oil-rich Permian Basin. The bad news quickly spread to other stocks in the energy sector including Chevron. Lower oil prices also weighed on the stock.

On Friday, March E-mini Dow Jones Industrial Average futures settled at 30720, down 189 or -0.62%.

Daily March E-mini Dow Jones Industrial Average

Daily Swing Chart Technical Analysis

The main trend turned down on the daily swing chart on Friday when buyers took out 30638, breaking a higher-top, higher-bottom chart pattern that had been intact since January 4. The main trend will change to up on a move through 31116. Taking out 31148 will reaffirm the uptrend. The downtrend will be reaffirmed on a trade through 29318.

The first minor range is 31148 to 30506. Its 50% level at 30827 is potential resistance.

The second minor range is 29760 to 31148. Its 50% level at 30454 is the first potential support level.

The short-term range is 29318 to 31148. Its 50% level at 30233 is the most important support level. It’s the last potential support level before the 23918 main bottom.

The main range is 25872 to 31148. Its retracement zone at 28510 to 27887 is controlling the near-term direction of the Dow.

Short-Term Outlook

Given the close at 30720, we’re looking for an upside bias to develop on a trade over 30827, and for the downside bias to resume on a trade through 30454.

Bullish Scenario

A sustained move over 30827 will indicate the presence of buyers. This could lead to a test of the pair of tops at 31116 and 31148. Taking out these levels will signal a resumption of the uptrend.

Bearish Scenario

A sustained move under 30454 will signal the presence of sellers. This could trigger a break into 30233. Buyers could come in on the first test of this zone, but if it fails, be prepared for an acceleration into a minor bottom at 29760.

The main bottom at 29318 is the last potential support before the 28510 – 27887 retracement zone. This area is controlling the near-term direction of the Dow.

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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.