GOLD: indications that coming rally is NOT impulsiveHi everyone.
I wanted to take a moment to show why I don't believe that GOLD is ready to breakout into new highs just yet, and why we are more likely to see further consolidation to the downside after a coming retest of the $1,556 highs.
For all of you who are well-versed on Elliottwave principles, you know that an impulse wave can only be either 5 waves or 9 waves (accounting for extensions). If you look at the rally from the lows (Oct 1 - Oct 3), you can clearly see this was a 7-wave move. Therefore, NOT impulsive but corrective.
If true, then the coming gold push higher (cross your fingers) is the B wave of the correction off the lows and NOT the beginning of a new impulse.
Of course, it IS possible that gold could form an EXPANDED FLAT wherein it does go to new highs. But this would still be part of a corrective move and would be followed by a 5-wave impulse DOWN to complete the consolidation.
Personally, I am skeptical of an expanded flat because the trendlines don't favor this playing out... but it is possible, of course.
P.S. Sorry about all the trendlines, I know its annoying and confusing. I have a free account and don't have the ability to create a new clean chart just for publishing ideas (not yet atleast!)
Comments appreciated.
benji
