E-mini Dow Jones Industrial Average (YM) Futures Technical Analysis – Taking Out 29624 Changes Trend to Down

March E-mini Dow Jones Industrial Average futures are trading lower and in a position to post a potentially bearish closing price reversal top after touching a record high and giving back all of its earlier gains. After the launch of a COVID-19 vaccine campaign in the United States, investors turned into sellers, which suggests a “buy the rumor, sell the fact” situation.

At 21:14 GMT, March E-mini Dow Jones Industrial Average futures are trading 29806, down 129 or -0.43%.

The Dow was weighed down by entertainment giant Walt Disney which fell after BMO Capital Markets downgraded the stock. On Friday, Disney shares were boosted to an all-time high after the company revealed its plans to create more content, add more subscribers and raise user fees.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart, but the formation of a closing price reversal top indicates that momentum may be getting ready to shift to the downside.

A trade through 30240 will signal a resumption of the uptrend, while a move through 29624 will change the main trend to down.

The minor range is 29350 to 30240. Trader reaction to its 50% level at 29795 could determine the direction of the market on Tuesday.

The short-term range is 25872 to 30240. If the main trend changes to down then we could see the start of a steep correction with its retracement zone at 28056 to 27541 the primary downside target. This is also a value zone so buyers could come in on the first test of this area.

Short-Term Outlook

Based on Monday’s price action, the direction of the March E-mini Dow Jones Industrial Average on Tuesday is likely to be determined by trader reaction to 29795.

The E-mini Dow is also forming a closing price reversal top. This won’t change the main trend to down, but if confirmed, it could trigger the start of a 2 to 3 day correction.

The main trend will also change to down on a move through 29624. A trade through the next swing bottom at 29350 will reaffirm the downtrend. This price is also a trigger point for a potential acceleration to the downside with the short-term 50% level at 28056 the next likely downside target.