Dow Jones Futures Analysis for Today

Dow Jones Futures Analysis for Today

Financial Instrument: Dow Jones Futures / E-mini Dow JonesPrice at the Time of Analysis: 42,960

Key Levels to Watch

Bullish Above 43,040

• Why Bullish Above?A move above 43,040 indicates price is surpassing the Value Area High (VAH) from two days ago, signaling buyer strength. This level represents a critical resistance zone that, once cleared, could allow for further upside.

• Profit Targets for Long Positions:

  • 43,150: Yesterday’s Point of Control (POC), marking the price level where the highest trading volume occurred.
  • 43,230: Yesterday’s VAH, the upper boundary of the value area, acting as a significant resistance level.
  • 43,415: Yesterday’s VWAP, a dynamic level often seen as a magnet for price.

Bearish Below 42,934

• Why Bearish Below?A break below 42,934 would place the price beneath today’s developing Value Area Low (VAL) and yesterday’s VAL, suggesting sellers have taken control of the market.

• Profit Targets for Short Positions:

  • 42,903: A key short-term target for bearish momentum.
  • 42,863: The VWAP from three days ago, a level that often provides temporary support.
  • 42,835: The VAL from two days ago, another significant support area.
  • 42,716: Just above the VAL of three days ago, serving as an extended bearish target.

Understanding the Tools Behind the Analysis

VWAP (Volume-Weighted Average Price)

VWAP represents the average price weighted by trading volume, providing a fair value benchmark for traders. When price is above VWAP, it indicates buyer strength, while price below VWAP reflects seller dominance.

Value Area Concepts (VAH, VAL, POC)

• Value Area High (VAH): The upper boundary of the range where 70% of volume occurred, acting as resistance.
• Value Area Low (VAL): The lower boundary, typically serving as support.
• Point of Control (POC): The price level with the highest volume, often acting as a pivot for price action.

Takeaways for Today

• Bullish Scenario: A break above 43,040 targets 43,150, 43,230, and 43,415 for potential profit-taking.
• Bearish Scenario: A drop below 42,934 opens the door to downside targets at 42,903, 42,863, 42,835, and 42,716.
• Trading Guidance: Use these levels to structure your trades and maintain disciplined risk management.

Trade at your own risk. Visit ForexLive.com for additional views.

This article was written by Itai Levitan at www.forexlive.com.