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I have altered the declining wedge idea from yesterday to reflect todays action.
The current labelling shows the whole structure off the high as a completed wedge to the downside in wave ‘i’ brown.
Wave (c) seems to have completed a clear 5 wave pattern to the downside off the wave (b) high.
So the next thing to watch for is the creation of a higher low in a 5/3 wave structure off nearby lows.
This will be the first indication of a turn into wave [iii] green.
The alternate wave ‘ii’ scenario is still in play.
If the price does rally again above the high at 1.0639 and into the 1.0680 region, it will conform the alternate wave count.
Wave ‘ii’ will then have completed a complex double combination correction.
The both interpretations of the wave count that I have shown, account well for this action.
And both wave counts call for a wave of selling to begin soon.
I think we will see slightly lower prices next week to complete the decline in wave (c).
The most obvoius target is the low at 1216, where wave (a) completed.
The decline so far off the wave (b) high looks like a developing 5 wave form in wave (c) blue.
It also looks ass if wave ‘3’ pink is extending into a five wave form itself.
GOLD declined below that confirmation level at 1244 today, which suggests that wave (c) blue is in fact underway.
I expect a five wave structure in wave (c) which would complete a simple expanded flat correction in wave [ii] green.
Both MACD and RSI are on the verge of crossing to the upside, in what will be the first indication that wave [iv] is completing.
no matter what way you slice the price action it all points to one theme,
downside momentum is stalling and the market is building for a rally.
I have moved the wave ‘iv’ grey label to the low of the day.
the price still managed to stay above the invalidation line although it came dangerously close.
We now have a pretty significant divergence between the declining price and the rising MACD.
this scenario will be the basis of a rally soon, but it may not stop the invalidation line from being triggered.