E-mini Dow Jones Industrial Average (YM) Futures Technical Analysis – Walking Down Steep Gann Angle at 22354

June E-mini Dow Jones Industrial Average futures are being pounded on Monday as investors panicked about the mounting damage from the coronavirus pandemic on the global economy. Trading in the benchmark average was halted for 15 minutes at the open, the third such pause in six days, as the benchmark index plunged 8% and triggered an automatic cutout.

Meanwhile, another aggressive cut in interest rates by the Federal Reserve to near-zero only added to investor worries that the pandemic was paralyzing supply chains and squeezing company finances.

At 19:55 GMT, June E-mini Dow Jones Industrial Average futures are trading 20868, down 1971 or -8.63%.

Daily Technical Analysis

The main trend is down according to the daily swing chart. A trade through 26962 will change the main trend to up.

On Friday, the Dow posted a potentially bullish closing price reversal bottom at 20230. However, since there was no follow-through to the upside, the signal was never confirmed. A confirmation of the chart pattern would not have change the trend to up, but it would have shifted momentum to the upside.

A trade through 20230 negated the chart pattern, but sellers only managed to extend the break to 20181 before the Dow mounted a strong intraday rally.

Short-term Outlook

On the upside, the resistance is a steep downtrending Gann angle, falling at a rate of 512 points per day since the 26962 main top on March 3. This angle dropped in at 22354 on Monday. Continue to look for move downside pressure as long as the Dow remains under this angle. However, be prepared for an acceleration to the upside if buyers can sustain a move over this angle.

On the downside, taking out the intraday low at 20181 will indicate the selling pressure is getting stronger. This could lead to a test of the next main bottom at 19558.

If 19558 fails as support then look for the selling to possibly extend into the next downtrending Gann angle at 18242. Crossing to the weak side of this angle will put the Dow in an extremely bearish position with the next major target 17297.