Today’s break above both 09-Nov’s 3.2080 high and 21-Oct’s 3.2180 high reaffirms this year’s major reversal higher and leaves smaller- and larger-degree corrective lows in its wake at 3.1210 and 3.0280, respectively.  These levels now serve as our new short- and long-term risk parameters from which traders can objectively rebase and manage the risk of a still-advised bullish policy and exposure.  Now-former 3.2180-to-3.2080-area resistance would be expected to hold as new near-term support per any broader bullish count from perceived frothy and potentially dangerous multi-year highs.

These bull risk parameters at 3.1210 and especially 3.0280 may come in very handy given threats to the major bull that include:

  • the prospect that the market is near or at the end to a 5-wave Elliott sequence up from 19-Mar’s 1.9725 low as labeled in the weekly chart above
  • waning upside momentum on both daily and weekly scales
  • historically frothy bullish sentiment/contrary opinion levels not seen in nearly three years and
  • the market’s engagement of Dec’17’s 3.3220 high and upper-quarter of its historical lateral range that has constrained prices since 2006.

If there’s a time and place to be leery and watchful of a peak and reversal threat, it is here and now.  And we will gauge such a threat by how well this market sustains prices above the corrective lows and risk parameters specified above.  Until and unless the market fails below these levels however, the trend is up on all scales and should not surprise by its continuance or acceleration.

In sum, a bullish policy and exposure remain advised with a failure below 3.1210 required for shorter-term traders to move to the sidelines and commensurately larger-degree weakness below 3.0280 for long-term commercial players to follow suit.  In lieu of such weakness, further and possibly accelerated gains should not surprise.

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