March E-mini Dow Jones Industrial Average futures are edging higher shortly before the mid-session on Wednesday on well-below average holiday volume. Energy and material stocks are supporting the market as well as investor bets on a strong economic recovery in 2021.
Prices rose on the back of COVID vaccine rollouts and hopes of bigger fiscal support from the government. However, the chances of a bigger stimulus check this year dimmed on Tuesday after Senate Majority Leader Mitch McConnell blocked a quick vote to back President Donald Trumpâ€™s call to increase COVID-19 relief checks.
At 16:48 GMT, March E-mini Dow Jones Industrial Average futures are trading 30386, up 148 or +0.49%.
Daily Swing Chart Technical Analysis
The main trend is up according to the daily swing chart. However, momentum may be getting ready to shift to the downside with the formation of a closing price reversal top the previous session.
A trade through 30166 will confirm the closing price reversal top. This could trigger the start of a 2 to 3 correction. A move through 30502 will negate the closing price reversal top and signal a resumption of the uptrend.
The short-term range is 29318 to 30502. Its 50% level at 29910 is the nearest downside target and potential support level.
Daily Swing Chart Technical Forecast
The intraday inside move suggests investor indecision and impending volatility, but the volume is probably too light to fuel a meaningful breakout in either direction.
The direction of the market into the close is likely to be determined by trader reaction to yesterdayâ€™s low and high.
Taking out 30166 will confirm Tuesdayâ€™s closing price reversal top. A sustained move under this level will indicate the presence of strong sellers. If this can create enough downside momentum then look for the selling to possibly extend into the pivot at 29910.
A sustained move over 30502 will indicate the buying is getting stronger. Under normal conditions, this could trigger an acceleration to the upside since there is no visible resistance.