Posted on Feb 16, 2024, 10:18 by Dave Toth

The market’s break today above Mon’s 187.575 high and our mini bear risk parameter nullifies the bearish divergence in very short-term momentum discussed in yesterday’s Technical Blog, chalks up this week’s setback to 182.825 as another correction and reaffirms the broader recovery from 06-Dec’s 165.40 low.  As a direct result of this resumed uptrend, the market has identified Wed’s 182.825 low as the latest smaller-degree corrective low and new short-term parameter from which shorter-term traders can objectively rebase and manage the risk of a resumed or continued bullish policy and exposure.

On a broader scale, the daily (above) and weekly log (below) charts of the Apr contract show the extent of the past couple months’ recovery from 06-Dec’s 165.40 low that is impressive indeed.  To even defer, let alone threaten this rally, the market needs to fail below at least 182.825 and preferably 30-Jan’s larger-degree corrective low at 180.425 that remains as our longer-term bull risk parameter pertinent to longer-term commercial players.

As the market remains a goodly distance away from 15-Sep’s 199.825 high however, it would be premature to ignore this recovery as a (2nd-Wave) correction given the even greater extent and 5-wave impulsiveness of Sep-Dec’s $34, 17% decline.  MIGHT that Sep-Dec swoon be just a corrective (4th-Wave) spasm ahead of a resumption of the secular bull to new highs above 200?  Yeah, sure.  But if this is the long-term count this market has in mind, then, “up here”, it will be important and required for the bull to BEHAVE LIKE ONE by sustaining trendy, impulsive and increasingly obvious behavior to the upside.  A failure below 180.425 would be behavior INconsistent with such a bullish count and would/could be considered the start of a (3rd-Wave) resumption of Sep-Dec’s decline within a major peak/reversal process.

These issues considered, a bullish policy and exposure remain advised with a failure below 182.825 required for shorter-term traders to move to a neutral/sideline position and commensurately larger-degree weakness for longer-term commercial players to follow suit and also reverse into a new bearish stance.  In lieu of such weakness, further and possibly accelerated gains should not surprise.

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