All odds still favor the 102.53 high as the top of wave 5, however we should soon see some acceleration to the downside if this is the case. A break below 98.00 should propel us down to 95.30 and most likely a lot lower.
Gold should soon test the long term uptrendline near 1,294 and a break below here will confirm that an important top is in place with the test of 1,430.95.
Oil is headed for the next resistance point near 96.45, but this rally is running out of time. The last two rallies in oil lasted for 52 and 54 days and on February 7. this rally will have lasted for 54 days and could easily be the time-limit for this rally.
Every thing point to a important top being in place with the test of 1,302.42.
Is the uptrend since 128,63 finally collapsing? It does look that way, but we still need a break below 136.35 to confirm that a top is in place for a decline towards at least 134.16, where we find the 38.2% retracement of the 128.63 - 137.59 uptrend.
EUR/USD is still holding it's uptrend from 128.68, we should soon see it break, but until it breaks, the risk is one more new high. We still need a break below 135.52 to confirm that the top is in place for a decline towards at least 134.10 and more likely 132.15 - 132.50 area.
The above picture shows the bearish USD picture. The dominating formation is the Shoulder/Head/Shoulder top, which was triggered in late September 2010. The target for this formation is around 71.41. The back-testing of the S/H/S neckline produced a double-top with a target around 76.20.
If the bearish case should continue to be the preferred count a top should be in place with the test of 137,03 in early North Amarican trading. A break below 135,70 is needed to confirm the top and the next decline.
The triangle target at 136.50 has been fulfilled and what might be lacking is the time. Very often triangles finishes at the apex of the triangle. If that is what we are "waiting" for a top should be seen in late European/early North American trading.
As can be see above gold, silver and copper are all topping. If we are looking at a major top remains to be seen, but all should at least see a period of correction. Copper and silver has been the leaders since the low in late 2008 and they should lead the way down too, while gold most likely will be the lacker.
Could a double bottom be forming in the VIX index? A break above 19 would confirm the double bottom for a rally towards 23.79 and a break above here will confirm that an important bottom was seen at 15.37.
Failure to break below 134.12 told us, that one more rally higher towards 136 was needed. My best micro-count is that the mess near 135.41 was an small triangle, which tells us, that the ongoing rally will be the last. The target for this rally is in the 135.36-136,50 area depending on where you measure the triangle.
Surpassed my ideal target area between 1,289 - 1,291 by a small amount. As the top has been 1,295.98. A break below minor support at 1,278 would be first indication that a top is in place, while a break below 1,261.87 confirms the top for a decline towards at least 1,174. I still belive that this decline could be pretty violent and deep.
Wave C from 128,63 might already have topped with the test of 135,38 yesterday. As all requierments was fulfilled at that point. Wave C broke slighly above the top of wave A (134.98), so the expanded flat might be over. A break below 134.12 and more importantly 133.54 will confirm the top for the next decline towards at least 127.13.
It might be worth stepping back a bit from the micro-count, trying to put the latest price-action into the bigger picture.
Zooming in on the last part of this decline. we can see that the decline from 142.81 came in three waves. The price-action since 129.64 looks like an expanding flat correction, where a rally towards 135,94 still is needed to end wave C of the expanded flat and then we should see and impulsive wave C down below 128.71 and 118.75 longer term.
The possible wave 2 of 5 has become much bigger, than first anticipated. As can be seen the Stoch. indicator has rolled over to the downside, but should soon do so.
The above count is my preferred at this point. As it can be seen it points to a full five wave rally since the low in late 2008. That means the upside at the very least is limited at this point, if not an important top is in place, as per my prefereed count. The evidence pointing towards an important top being in place is negative divergence at the weekly stoch. indicator and ofcause the complet five wave rally.
Wave 2 of 5 exceeded resistance at 131, which has opened a window for a move towards the 61.8% retracemnet at 132.14. Currently we see the 50% retracement tested, but I think we will see a move closer to 132.14 now.
The bottom of wave 1 of 5 took a little longer than ecpected, but it's clearly in place now, and wave 2 of 5 ongoing. I'm looking for resistance in the 130.80 - 131.00 area, for the next leg lower. We saw no extension in wave 1 or 3, why I expect wave 5 to extent. Next downside target 121.20?
I thought, that the wave [4] correction was over at 81.18, but the latest development has change that view. The overlapping structure call for more downside and the next obvious correction-target is 76.92 - 77.82 area.
The decline Friday was more powerful than I anticipated, but wave i of 5 should soon be in place.
Sorry for not having any Elliott wave count on this chart.
The triple top neckline has just been broken, which makes gold vulnerable for a major sell-off. The first target is near the 1,264, but this sell-off could easily accelerate to the downside, if this support is broken too.
My prefered count is, that we are in wave 5 down from 142.81. The decline from 134.33 is wave i of five and odds favors, that it ended at 129.58 in early European trading. We should now see a correction back towards the 131.40 - 131.96 area, but can't exclude a correction higher towards 132.52, before wave iii of 5 down sets in. A break above 130.20 confirms that wave i is over and wave ii underway.
A five wave decline since the 11.855 could be in place (see the weekly chart above). The momentum indicators confirm a possible bottom in place, as they both displays a positive divergence.
The break below the support line at 130.53 confirms that the correction is over at the next target is the 129.64 low, where I expects wave i of 5 to end. Bulldozer in a comment to my EUR/USD comment yesterday, see the link, that it looked like a possible Shoulder/Head/Shoulder. As can be seen it could very well be a S/H/S calling for a continuation down to 116.75.
Trying to call a top in in these two shining metals, has come with embarrassment, but just looking at the weekly gold-chart, clearly displays that a five wave rally from 680 is in place. At the same time a possible triple top could be in making, but before the "neckline" at 1,360 breaks. I'll just call for the possibility.
I have no Elliott wave counts on the silver charts.
The new high today keeps the uptrend intact, and gets us one step closer to the ideal target area between 1,289 - 1,291. That said it's also time to protect yourself from a sudden turn around.The big question is whether this is wave "C" in total or just wave "1" of "C"?
Time will tell!
Did the correction end at 134.33 yesterday? If support at 132,48 breaks, then the answer is yes.
On december 22 - 2010 I wrote, that a bottom could be very close at hand. I had the next support at 124.80, which was broken for for an overshoot to 124.00. With the rally we have seen today the odds do favor a bottom is in place for a rally towards the top of wave 4 at 137,75 - 138,35. (The chart below is a close-up of the above chart).
The sideways action since the beginning of December is becoming an never ending story.
