Since this weekend I don’t have anything new to add to what I have been discussing regarding SPX I think it is interesting to review the Gold EWP.
Long -Term Count:
In my opinion from the September 2011 high to the June 2013 low price has unfolded a Double Zig Zag
Since the internal structure of the up leg off the June 2013 to the August peak is corrective I rule out that price has concluded the correction.
Therefore we could have four options:
1. Blue count: Price is on the verge of beginning an impulsive wave (Z) down that will conclude a Triple Zig Zag from the 2011 high. This option will become the front-runner if in the following pullback the internal structure is impulsive (As long as momentum indicators do not turn bearish this option is less likely)
2. Red Count: Price is unfolding a large wave (B) countertrend rebound that could reach the trend line resistance that connects the September 2011 high with the October 2012 lower high. Once the wave (B) is in place a large wave (C) down will conclude the corrective pattern off the 2011 high (Too soon to give much credibility to this count)
3. (Green count): Price is unfolding the wave (X) within a Triple Zig Zag off the 2011 high. If price clears the August peak we have a strong resistance in the area of 1489 (Horizontal resistance, 0.5 retracement of the down leg off the October 2012 lower high and the 50 wma). The assumed wave (X) could reach the 1506 area (1 x 1 extension target). Once the wave (X) is in place it will be followed by the last Zig Zag down.
4. Triangle wave (X): Not shown in the chart below
Lets have a look at the weekly momentum indicators: