Are we in a bullish environment (see the chart above) dominated by the inverted Shoulder/Head/Shoulder bottom. Elliott wave wise that would mean we currently is in the middle of wave 3, which should reach the 1,216 - 1,217 area, before some kind of flat or triangle wave 4 sets in just to be followed by one last rally in wave 5.The trouble with the bullish count is the divergence displayed on the MACD indicator. That is not the normal for wave 3. But as long as support at 1,131.93 and more importantly 1,122 isn't broken to the downside, the trend is up.
Or are we in a Bearish environment (see the chart below), which says we are making a large A-B-C correction as wave 2. If this count is the correct one, we should be very close to the top. Wave C would equal wave A at 1,158.73 and we have seen wave C break slightly above the channel resistanceline, which could be a warning of exhaustion soon. The divergence on the MACD indicator is more in line with this count, but as long as support at 1,131.93 and more importantly 1,122 isn't broken to the downside, the trend is up.
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