E-mini Dow Jones Industrial Average (YM) Futures Technical Analysis – 34677 Controls Early Tone on Tuesday

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September E-mini Dow Jones Industrial Average futures inched higher on Monday in a limited holiday session. With the cash market closed for U.S. Independence Day. When the U.S. stock market opens on Tuesday, bullish investors will be looking to extend Friday’s rally that was fueled by a mixed labor market report that may keep the Federal Reserve from raising interest rates any time soon.

In an abbreviated trade on Monday, September E-mini Dow Jones Industrial Average futures settled at 34688, up 11 or +0.03%.

The Labor Department’s employment report showed nonfarm payrolls beat the forecast, while the unemployment rate rose and average hourly earnings came in as expected.

The focus now shifts towards the second-quarter earnings season and progress on President Joe Biden’s infrastructure bill that could help the equity market keep the momentum.

Investors will also look to minutes from the Fed’s June meeting next week for the latest view on inflation, bond tapering and rates at a time when the easy monetary stance appears to be at an inflection point amid a booming U.S. economy.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. The uptrend was reaffirmed during the electronic session on Monday when buyers took out a pair of tops at 34711 and 34721. A trade through 34006 will change the main trend to down.

The short-term range is 34883 to 32902. The index closed on the strong side of its retracement zone at 34126 to 33893, making it new support.

Short-Term Outlook

The direction of the September E-mini Dow Jones Industrial Average early Tuesday is likely to be determined by trader reaction to 34677.

Bullish Scenario

A sustained move over 34677 will indicate the presence of buyers. Taking out 34748 will indicate the buying is getting stronger. This could trigger a surge into the record high at 34883. This is a potential trigger point for an acceleration to the upside. There is no resistance over this level since the Dow is at an all-time high.

Bearish Scenario

A sustained move under 34677 will signal the presence of sellers. This could trigger a quick break into 34377. Buyers could come in on a dip into this level. If it fails as support then look for the selling pressure to possibly extend into the short-term Fibonacci level at 34126, followed by the main bottom at 34006. If this level fails as support, the trend will change to down with 33893 the next target.