We remain in a bull leg with a settlement below $1260.70 (December Futures) being a trigger for likely continued declines.
Rallies to Sell
There was some profit taking in the $1274 area. The market so far has absorbed it. Be aware of strong longs selling to new, weaker longs now. If O.I. flatlines in another leg up, that is the cue to be careful as the "strong hands to weak hands" rotation may be taking hold
After that $1294-97. Any break above these areas is good for continuation. But a break back below after piercing will likely cause more aggressive, almost panicked liquidation. Some selling would be by longs with nice profits to book, others from short term momentum stop-losses placed after getting long on initial piercing that area.
Dips to Buy
Day traders will likely buy in the $1271 area with tight stops. There is a rising trendline coming in at $1260.70 on the hourly this opening to be bought first time down. Underneath that there are plenty of places to buy and reverse if broken through.
Keep in mind a settle below $1260.70 likely not only negates the current bull run, but starts a bear leg.
Reference: Marketslant
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