E-mini Dow Jones Industrial Average (YM) Futures Analysis – Bullish Over 22004, Bearish Under 21856 This Week

September E-mini Dow Jones Industrial Average futures finished last week higher, putting the market in a position to challenge the all-time high. The market was supported by good, but not great U.S. economic data, low inflation and a forecast that showed the Fed may not raise interest rates until at least mid-2018.

The longer-term fundamentals are supportive for the bull market. Short-term, investors are going to have to be prepared for geopolitical risk from North Korea.

Weekly Technical Analysis

The main trend is up according to the weekly swing chart. A trade through 22132 will signal a resumption of the uptrend after a short-term setback.

Taking out last week’s high at 22037 will make 21579 a new main bottom. If this occurs then taking out 21579 will change the main trend to down.

The short-term range is 22132 to 21579. Its 50% level or pivot is 21856. The close over this pivot is helping to give the market an upside bias.

Forecast

Based on last week’s close at 21980, the direction of the Dow this week is likely to be determined by trader reaction to the downtrending angle at 22004.

Overtaking 22004 and sustaining the rally will indicate the presence of buyers. This could drive the market into the next downtrending angle at 22068. This is the last potential resistance angle before the 22132 main top. Overtaking this top could launch another leg higher.

A sustained move under 22068 will signal the presence of sellers. This could trigger a break back into the pivot. Falling below the pivot at 21856 will indicate the selling is getting stronger.

The next support angle under 21856 is at 21778. This is the trigger point for an acceleration into 21579, followed by a long-term uptrending angle at 21554.

Watch the price action and read the order flow at 22068 all week. Trader reaction to this angle will tell us if the buyers or sellers are in control.

Essentially, we’re looking for a bullish move this week on a sustained move over 22004 and a bearish tone to develop on a sustained move under 21856.