The rise in XAU since the low in 2000 to me always appeared to be corrective in nature, perhaps a flat, with the "C" ending last summer. If so, the big triangle would be the "X", with another large "three waver" up pending.
For trading purposes it is not very important whether or not this view turns out correct. Still, we are probably now in the right region for trying a short entry, and if the index makes it to ~65, it might be the place to reverse.
The range of targets - if the triangle works out - is wide. I think at the very least it would be likely to travel higher than last year's peak.
If there is no pullback now, and the index breaks the upper trendline, that would mean that we had not a triangle, but a clumsy large flat, and the rally is big and for real. On the other hand, if it pulls down to 65 and continues lower, that would mean that the rally was finished last summer, and the larger bear market in this index is still going on.
Did I forget anything? -bg. |
