Stocks Forming Top?, Gold Met Target Price - 11/18 /09

Stocks

With the move higher this week above last weeks high, stocks now appear to be forming a topping formation with a wave five completion possible between this Friday and Tuesday of next week. The 1121.05 area mentioned previously looks like the best target price for the high on the S&P500. The Dow and S&P500 are both in the area of a 50% retracement of the move down into the 2009 crash low. Because of that, and the possible count of five waves up from the March/2009 low, the correction could be the largest correction since the March bottom.

Gold/GLD

GLD met the 112.75 target price today. It is possible to count five waves up from the late October low, but with stocks possibly not topping until next Tuesday, it may work its way higher along with stocks, possibly even as high as around 117.

Stocks and Gold Update - 11/15/09

Gold/GLD

GLD has not yet reached the 112.75 target but has met the minimum requirements for five waves up so it could finish this up wave at any time. The five minute chart looks like it may finish waves three thru five by Tuesday, possibly around 111.35. A short term gold top would also indicate that stocks are also near a top.

Stocks

It is possible that stocks completed five waves up on Wednesday. But with gold likely not yet at its crest, stocks may form a lower double top early this week. It appears likely it will be a short term top and may bottom as early as the end of the week. Initial support is 10086 and 10003 on the Dow. The current wave appears more corrective than impulsive so it may be a B wave or X wave within a larger correction. That is also indicated by the fact that both the Nasdaq composite and NYSE composite have not gone above the October highs.