E-mini Dow Jones Industrial Average (YM) Futures Technical Analysis – Needs to Hold 35800 to Sustain Momentum

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December E-mini Dow Jones Industrial Average futures climbed to a record high on Tuesday, getting a boost from a series of encouraging earnings reports, while investors anticipated the Federal Reserve’s next meeting where policymakers are expected to announce the withdrawal of pandemic-era stimulus.

At 17:54 GMT, December E-mini Dow Jones Industrial Average futures are trading 35944, up 144 or +0.40%.

The spotlight is now on the Fed’s policy meeting that started earlier in the day, with the U.S. central bank expected to approve plans to start tapering its monthly bond purchases, while focus will also be on commentary about interest rates and how sustained the recent surge in inflation is.

The price action suggests investors have priced in tapering and a first post-pandemic interest rate hike next year. However, investors could be sensitive to the timing of the first rate hike as well as the frequency of the rate hikes.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. A trade through the intraday high at 35971 will signal a resumption of the uptrend.

A trade through 33984 will change the main trend to down. This is highly unlikely, but due to the prolonged move up in terms of price and time, the market is inside the window of time for a potentially bearish closing price reversal top.

The minor trend is up according to the daily swing chart. A trade through 35383 will change the minor trend to down. This will also shift momentum to the downside.

The minor range is 35383 to 35971. Its 50% level or pivot at 35677 is support.

The short-term range is 33984 to 35971. If the minor trend changes to down then look for the selling to possibly extend into its retracement zone at 34978 – 34743.

Daily Swing Chart Technical Forecast

The direction of the December E-mini Dow Jones Industrial Average into the close on Tuesday is likely to be determined by trader reaction to 35800.

Bullish Scenario

A sustained move over 35800 will indicate the presence of buyers. Taking out 35971 could trigger an acceleration to the upside. There is no resistance.

Bearish Scenario

A sustained move under 35800 will signal the presence of sellers. If this move generates enough downside momentum then look for the selling to possibly extend into its pivot at 35677.

Buyers could come in on the first test of 35677, but if it fails then look for a possible acceleration to the downside with 35383 the next potential target.