The strong up move from the daily ‘triple’ bottom lows at 1037.00/1-1037.25 allowed for this move back to the 250 daily moving average at 1097.85. We think this market will find strong resistance in this area and allow for a move back into the important support at 1085 and potentially the 1075 zone on the daily chart. A difficult close above the 1125/30 zone remains key to moving out of this four month trading range. Finally penetrating that key resistance would allow for a move into the 1170/75 area and potentially the 1211.50 high.
Near term, holding above the 1085/82 area will allow for another test of the 1107.25 high and immediate resistance point. But failure below 1080 would open the bears to the 1075 area where all the clustered 20 and 13 moving averages reside. Breaking that support would again offer the 1050/1037.00 lows which will continue to be a break point for the 1002.75 low of this move.
Strategy- Go short at 1098, stop 1108, target 1086 and then 1075. Go long 1074, stop 1068, target 1102.
