Dow Futures: Weekly Price Action & Technical Analysis as on 12-JUN-2016

Like the S&P Futures, the Dow futures are also in backwardation, and currently the contract for September is lower about 0.5% than the ending contract of June.

Since the market is still in a backwardation, it is very hard to analyze and measure correctly the price action, as the June contract chart, the September contract chart, and the Dow continuous contract chart have lots of differences in prices among them. So, all the levels mentioned here are the levels for the September contract.

Not surprisingly, taking out the Monthly High in the passing week led to a false break (warned in the last review).

Currently, a good bullish scenario might start with a false Weekly thrust down (below 17679 for the YMU6), respecting the previous week’s Low at 17560, then taking out the Weekly high at 17914. That bullish scenario might bring the price above the Weekly swing High at 17989, a trigger that as a chain reaction signals for a bullish move towards 18800 (mentioned in the last review). Taking out the Weekly High without making first a LL is very doubtful for true bullish move, and in this case, it is better to wait for the Weekly swing high (17989) to be taken out and start the long term bullish scenario (towards 18800). Pay attention that the correct initial stop loss for the bigger bullish scenario (towards 18800) is the Weekly swing low at 17208.

For the bearish side, as long as the Weekly swing high at 17989 is respected, a bearish signal will most likely fires only by taking out the Monthly low at 17208. In this case, the target is at the 16500 area (initial stop loss is the Weekly high, currently at 17914).

Despite the scenarios mentioned above, there are pretty good chances to see the price holds within the range (17560-17909) in the coming week.

Dow Futures: Daily chart with the main scenarios mentioned (at the courtesy of prorealtime.com)

Dow Futures: Daily chart with the main scenarios mentioned (at the courtesy of prorealtime.com)

 

Disclaimer: Anyone who takes action by this article does it at his own risk and understanding, and the writer won’t have any liability for any damages caused by this action.

 

Gil Ecker

[email protected]

Market Analyst and trader

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