This morning's break above Thur's 2.697 initial counter-trend high confirms our broader bullish count discussed in Fri's Trading Strategies Blog and now leaves TWO corrective lows in its wake at 2.569 and 2.523 that serve as our new short- and longer-term risk parameters to a resumed bullish policy. As a direct result of this morning's resumed uptrend from 12-Aug's 2.523 low, a failure below Fri's 2.569 low is required to render this recovery a 3-wave and thus corrective affair that would definitely threaten our broader bullish count and expose potentially significant losses thereafter. Until such sub-2.569 weakness is proven we believe the market has begun a (5th-Wave) rally to new highs above 01-Jul's 2.990 high.
As discussed Fri, the daily log scale chart above shows the clear 3-wave decline from 01-Jul's 2.990 high. Left unaltered by a relapse below at least 2.569 and certainly 2.523, this 3-wave sell-off attempt is considered a corrective/consolidative structure that now warns of a resumption of this year's major uptrend that preceded it. These issues considered, a generally bullish policy and long exposure recommended from 2.585 OB remain advised with a failure below 2.569 required to threaten this call enough to warrant a move to the sidelines. In lieu of such weakness further and possibly accelerated gains to eventual new highs above 2.990 are expected.