Having seen a downside break of the key October low and support at $1458, the market is engaging in a technical rally. Is this a false downside break? We do not believe so. The confirmation breakdown on momentum (RSI hitting its lowest since August 2018) and growing negative configuration on MACD. The very mild nature of the recovery also hints at a very indecisive rally (false downside breaks are often met with sharp retracements). We see a tentative rally perhaps drifting into the resistance of overhead supply $1474/$1480. However, a failing of this rally is likely and any renewed sell signal would be an opportunity to retest the recent low at $1445 and lower. The hourly chart shows the market is in near term recovery mode now and $1458 seems to be a basis of support above $1445. It would need a move above resistance around $1494 to suggest legs in a rebound.
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