RJO FuturesCast

Daily Futures Market News, Commentary, & Insight

This morning’s break below 15-Dec’s 2.581 low confirms our suspicions that the recovery attempt from that low to Mon’s 2.778 high is a corrective/consolidative event within the broader downtrend as discussed in 13-Dec’s Technical Blog. Per such, shorter-term traders with tighter risk profiles are advised to consider Mon’s 2.778 high as our new short-term risk parameter from which a still-advised bearish policy can be objectively rebased and managed.
The downtrend remains clear and present in the daily (above) and weekly (below) log scale charts of the Jan contract. The developing POTENTIAL for a bullish divergence in the rate-of-change measure of momentum is also clear in the daily chart above, but proof of strength above 2.778 is required to CONFIRM the divergence to the point of non-bearish action like short-covers. In lieu of such strength further and possibly accelerated losses remain expected.

Commensurately larger-degree strength above 24-Nov’s 2.903 (suspected 1st-Wave) low is required to jeopardize the impulsive integrity of a broader wave sequence down from 13-Nov’s 3.321 high to negate a longer-term bearish count pertinent to longer-term bears.
On an active-continuation chart basis, the weekly log chart below shows the bear’s continuation of its 1-YEAR downtrend from 28Dec16’s 3.902 high and break of the 2.641-area that has supported this market for the past 11 months. The pivotal downside break exposes an area below the market that’s totally devoid of any technical levels of merit and highlights recent corrective highs like 2.778 as the most objective and pertinent around which trading decisions should be made.

In sum, a bearish policy and exposure remain advised with strength above 2.778 required to defer or threaten this call enough to warrant paring or neutralizing bearish exposure commensurate with one’s personal risk profile. In lieu of such strength further and possibly accelerated losses remain expected straight away.


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