The early day price action continues the sideways trade after making the 1124/28 target area. A close above that strong resistance is key to challenging the 1129.50 high.
Resistance resides at the 1122/23 over the near term ahead of the 1227.25 high. Support resides at 1114 but holding above 1112/10 will be key to retaining the bulls strength in this up move. The 1129.50 highs of this big congestion zone coincides with the 50% retracement of the 1211.50 high to the 1002.75 low of the last three months and the 61.8% retracement level. Longer term (?) a close above 1134 remains key to moving into the 1150 area and potentially the 1175/95 area over the longer term.
A defensive close below 1110 would hint of a more sideways trade and hint of a lower ‘double top’ that could test the 1100 area and potentially the important support at the 1090/85 old resistance/weekly down trendline. An unanticipated close below 1100 would renew the focus back to the 1083 low. Breaking that key support would offer the bears the 1074/68 support. But closing below 1060 will confirm a longer term top to push into the 1051 through 1035 area. But until weakness breaks the 1110 area we want to remain positive on this market.
Strategy– Long at 1086/84, target achieved 1124/28. Longs at 1112 exited at 1124. and short term trade long at 1114 target achieved at 1124 also.
New trade– go long at 1117, stop 1110, target 1128/31, go short in that area and use an upside stop at 1136.
