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JUNE
SWOON - SUMMER RALLY
by Joseph Russo
ElliottWaveTechnology.com
June 3, 2007
"The
Raging Bull"
we
spoke of a couple of weeks ago, appears to have taken up permanent
residence across many sectors of the financial sphere. This bull has
been relentless, cunning, and quite masterful in dealing with the
plethora of participants who have been eagerly anticipating some type of
correction – if not an outright crash!
After
11-weeks of nothing but blue sky, we suspect this bull may simply be
growing bored of the dominance it imposes upon bears at will. Perhaps a
couple of weeks respite in June ought to be a minimum at which this
easily antagonized bull may once again become angered, electing to
resume its deceptive charge with renewed fury.
The
Dollar has been on the rise for five-weeks since its low in
April. The king-fiat’s next hurdle is the 83.00 level - just above
critical overhead resistance.
The
Dow packs an overabundance of bullish-lift, which if threatened
by a wide enough air pocket, could abruptly reverse the parabolic trend.
We would consider anything less than that, minor turbulence.
After
a five-week pounding, gold has come back to life and is
back-testing a key broken uptrend from 2007. For the next two weeks, key
support is at $650, and resistance sits at the $690 level.
The
S&P remains on a critical mission toward testing, and
breaking out above its historic intra-day high at 1553.11. The timing at
which the S&P elects encounter with such critical mass may prove
pivotal
March
5 – April 20
After a robust 9.75% rally from the March low, Swing-Trade guidance for
Gold returned to a sell-side bias. Our bearish posture arrived courtesy
of a sell-probe signaled against GLD’s 68.73 high on April 20.
May
2 – May 7|
By
May 2, just seven sessions from our sell-side guidance, GLD printed an
intraday low of 66.11 - down 3.77%. From that interim pivot low, in just
two trading sessions - Gold exploded to the upside, challenging the
resolve of those holding short – climbing back to 68.46, retracing
nearly all of the short-side gains accrued over the previous seven
sessions.
May
7 – May 17
The two-day price spike off the interim pivot low failed to produce any
follow through. For the next 9 trading sessions GLD - pounded with sell
orders - plummeted 5.46% before reaching an interim bottom at 64.72.
From
Elliott
Wave Technology’s
Near Term Outlook for the week
ending June 1, 2007
May
17 – May 23
Upon stabilizing from the May 17 base at 64.72, GLD began inching its
way back to the upside. Our studies suggested that the market was
nearing a significant level of oversold, and ripe for a rally of merit.
We quickly began warning sell-side swing-traders to prepare for imminent
“buy-probes.” Price chopped higher for the next 5 sessions -
touching an intraday high of 65.89 on May 23. That short-lived rally was
corrective, and marked our smaller degree 4th-wave crest. Although we
were turning near-term bullish on Gold, the market was still in a tight
downward trend channel, and was telegraphing the potential for another
marginal 5th-wave low prior to setting a tradable bottom.
May
24 – June 1
|While
progressing through the 4th-wave high, we had drawn a lower boundary
trendline illustrating a bearish flag pattern that was engulfing the
triple-three corrective rally. Further, we projected an additional
.77-cent decline would be likely if that boundary were to fail. As if on
queue, trade on May 24 broke down sharply below that boundary - printing
GLD’s intraday low of 64.52, down .79-cents on the day. Known in well
in advance, our pending buy-probes confirmed at 64.52 - just .20-cents,
or a marginal .3% under the May 17 low of 64.72. On May 29, after a
gap-up out of a small corrective coil, the sudden rally faded just as
quickly as it arrived, then headed straight back down toward a near
re-test of its lows. By sessions-end, GLD reversed higher to close the
month back above the power down trendline. By the end of trade on Friday
June 1, another gap-up rally took root, and closed the first session of
June sharply higher at 66.44, up 3% from the May 24 low.
The
Near Term Outlook delivers unrivaled short and long-term forecasting
guidance for the U.S Dollar, Dow, SPX, Gold, HUI, and NDX.
The
concise, impartial market guidance present throughout this publication
provides clear targets, triggers, and variant parameters from which
active traders can successfully construct low-risk trading strategies.
The immediate and long-term rewards in adopting such guidance as part of
one’s trading arsenal are measurable.
We
remind readers that the rigors and discipline we employ in delivering
such guidance is by no means arcane. Our methodology is fully
transparent, and clearly translated, providing a lifelong benefit of
advanced trading skills to each of our clients. We do not predict
prices, nor are we ever tied to a fixed bias or singular perception;
instead, we adapt to the price action as it unfolds. As evidenced in
reviewing our prior period’s guidance for GLD - streetTRACKS gold, the
competitive edge is most notable.
Trade
Better / Invest Smarter…
© 2007
Joseph Russo
Editorial
Archive
CONTACT
INFORMATION
Joseph
Russo
Chief Editor & Technical Analyst
Mission Viejo, CA USA
www.elliottwavetechnology.com
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