June E-mini Dow Trading Inside Major Retracement Zone

June E-mini Dow Jones Industrial Average futures are trading higher late in the session on Thursday, rebounding from the previous session’s losses, as falling jobless claims added to confidence in the U.S. economic recovery.

Blue chip stocks have bounced back and forth this week, alternating between plus and minus days as investors continued to monitor the war in Ukraine, while monitoring the potential impact of more aggressive Federal Reserve interest rate hikes.

At 19:40 GMT, June E-mini Dow Jones Industrial Average futures are trading 34543, up 293 or +0.86%. The SPDR Dow Jones Industrial Average ETF (DIA) is at $346.44, up $3.03 or +0.88%.

In economic news, a drop in jobless claims to the lowest in decades gave some investors confidence the U.S. economy could keep growing through headwinds such as the Russia-Ukraine war and higher interest rates. Initial jobless claims las week totaled 187,000, the lowest level since 1969, the Labor Department reported Thursday.

The biggest gainer is Intel Corp, up 6.64%. This is followed closely by UnitedHealth Group, which is up 1.97% and Apple Inc, which is posting a 1.91% gain.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. A trade through 34792 will reaffirm the uptrend. This will make 34214 a new main bottom.

If buyers don’t take out 34792 then the nearest main bottom will remain 32578.

The main range is 36708 to 32086. The market is currently trading inside its retracement zone at 34397 to 34942.

The short-term range is 35649 to 32086. Its retracement zone at 34288 to 33868 is support. This zone stopped the selling at 3214 earlier today.

Short-Term Outlook

The direction of the June E-mini Dow into the close on Thursday or on the opening on Friday is likely to be determined by trader reaction to the support cluster at 34397- 34288.

Bullish Scenario

A sustained move over 34397 will indicate the presence of buyers. If this move is able to generate enough upside momentum then look for a surge into the main top at 34792, followed by the resistance cluster at 34942-34950.

Taking out 34950 with strong volume could trigger an acceleration to the upside.

Bearish Scenario

A sustained move under 34214 will signal the presence of sellers. This could trigger a fast break into the short-term 50% level at 33868. This level is a potential trigger point for an acceleration to the downside.