Another Record S&P High Yields New S-T Bull Risk Level | RJO Futures

February 21, 2017 8:28AM CST

Today's break above last week's 2351.50 high detailed in the 240-min chart below leaves Fri's 2336 low in its wake as the latest smaller-degree corrective low the market now needs to sustain gains above to maintain a more immediate bullish count.  Its failure to do so would confirm a bearish divergence in very short-term momentum that would break the latest portion of the secular uptrend from 31-Jan's 2262 low.  In this regard 2336 is considered our new short-term risk parameter from which shorter-term traders with tighter risk profiles can objectively rebase and manage the risk of a still-advised bullish policy.  In lieu of at least such sub-2336 weakness the trend is up on all scales and should not surprise by its continuance or acceleration.


Emini 240 min Chart

Emini Daily Chart

On a practical scale more commensurate with the major bull market the daily log chart above still shows 31-Jan's 2262 low as the next larger-degree corrective low this market remains minimally required to fail below to threaten the bull.  Relative to the secular advance shown in the weekly log chart below, even a failure below 2262 would only put a minor dent in the bull and would be grossly insufficient to suggest anything more than a slightly larger-degree corrective and another buying opportunity.

Indeed, the weekly log chart below shows an absolute ton of former resistance ranging from Aug's 2192 high to 2134-to-2100-area that capped the market from last May until Jul's breakout that is now considered a huge new support range within the secular bull market.  To truly threaten this huge bull, we continue to believe that the market needs to break AT LEAST 04Nov16's 2079 orthodox low.

Emini Weekly Chart

On an even broader scale the monthly log scale chart below shows the secular bull market intact above Feb'16's 1802 low.  Obviously and as always, managing the risk of a still-advised bullish policy comes down to an issue of SCALE.  For long-term players and our personal IRA accounts, weakness below at least 2079 is required before defensive action is needed or required.  For longer-term "traders", a failure below 2262 is sufficient proof of a pending correction to warrant paring or covering bullish exposure temporarily.  For scalpers a failure below 2336 now suffices to cover bullish exposure in order to circumvent the depths unknown of a smaller-degree corrective setback.  In lieu of weakness below at least 2336 and preferably 2262, the trend is up on all scales and is expected to continue.

Emini Monthly Chart

RJO Futures | 222 South Riverside Plaza, Suite 1200 | Chicago, Illinois 60606 | United States
800.441.1616 | 312.373.5478

This material has been prepared by a sales or trading employee or agent of RJO Futures and is, or is in the nature of, a solicitation. This material is not a research report prepared by RJO Futures Research Department. By accepting this communication, you agree that you are an experienced user of the futures markets, capable of making independent trading decisions, and agree that you are not, and will not, rely solely on this communication in making trading decisions.