E-mini Dow Changes Trend to Up on Trade Through 33588

June E-mini Dow Jones Industrial Average futures are trading sharply higher shortly after the close on Tuesday, boosted by falling oil prices and inflation data as well as the hopes of a cease fire in Ukraine.

The rally was led by shares of Walt Disney, Microsoft Corp and Procter & Gamble, which rose 4.01%, 3.91% and 3.64% respective.  Meanwhile, a drop in oil prices put pressure on energy stocks with Dow component Chevron losing more than 4%.

At 20:02 GMT, June E-mini Dow Jones Industrial Average futures are trading 33452, up 614 or +1.87%. The SPDR Dow Jones Industrial Average ETF (DIA) settled at $336.11, up $6.04 or +1.83%.

In economic news, February’ surge in energy prices led wholesale goods prices to their biggest one-month jump on record, the Labor Department reported Tuesday. The headline producer price index (PPI) rose 0.8% in February from the previous month. While that was slightly lower than the 0.9% estimated by Dow Jones, it still showed a 10% gain from the same time last year.

However, core PPI, which excludes food, energy and trade services, rose just 0.2%. That was below the expectation of 0.6%.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. A trade through 33588 will change the main trend to up. A move through 32218 will signal a resumption of the downtrend.

The minor support is a pair of 50% levels at 33118 and 32903.

On the upside, the nearest resistance is a 50% level at 33868. This is followed by a main retracement zone at 34397 to 34942.

Short-Term Outlook

The strong upside momentum going into the last hour of trading indicates we could be in for a higher opening on Wednesday. One concern, however, is the possibility of a slow trade ahead of the Fed’s interest rate announcements.

If there is a follow-through to the upside then look for buyers to take a run at the main top at 33588. Taking out this level will not only change the main trend to up, but it could trigger an acceleration into the 50% level at 33868. It all depends on the buying volume, however.

Overtaking 33868 will indicate the buying is getting stronger. This could lead to a test of another main top at 34018. Taking out this level will reaffirm the uptrend, putting the index in a position to challenge the major retracement zone at 34397 to 34942.