The failure to close above the 89.50 area will continue to pressure the 88.00 support area. A more difficult but close above 89.50 would argue for a much firmer tone into the 90/92 area into August.
Choppy price action along with rejection from the critical 89.00/25 area (38.2% retracement) retains the bears control to pressure support at 88.30/00 near term. Below 88.00 would add to the idea of a lower top to extend into 87.65 just ahead of the key 87.00 level – the 78.6% retracement of the rally from 2009. But closing above 89.50 into Friday would renew the idea of a more sustainable upmove into the May peak
at 90.25 and potentially the 93.00+ area over the longer term..
Strategy: Short at 89.10, target 87.00/25, stop at 89.10.