Friday, 26 February 2016

Gold has topped at weekly chart mid channel trend line resistance, next wave lower beginning

Weekly chart. I favour a turn lower from mid channel trend line resistance. If the market doesn't support that view, it'll let me know by closing above the line.

Next , zooming way in to the waves on the hourly chart. Next leg lower beginning? A break through trend line support would boost confidence in that view.

S&P 500 rallies free of trend line resistance, new record highs lie ahead

Daily chart shows the S&P 500 rallying free of trend line resistance. More potential resistance sits overhead, but it will be swept aside if my wave count is correct. Let's see. Regardless of the short term action in coming days, the wave structure of the decline from the 2015 peak clearly takes a corrective A-B-C form, which implies that new record highs lie ahead. Weekly and monthly charts provide additional non Elliott Wave evidence to support this case.

I've labelled the weekly chart to show a Head and Shoulders top, though perhaps it would be better described as a rounding top. In either case, the bearish signal given by the break of the neckline has failed. This itself is a bullish edge.

Monthly chart show the market trending higher from the 2009 low. The up trend remains intact.