Breakout - Market Analysis on May 13th, 2015

Finally, the metals have taken the opportunity to break out in the set ups we have been noting for weeks.  But, now the question will be where do we top.

Based upon the current structure, I do not believe we will see the bigger rally I had initially wanted to see, as the smaller time frame counts suggest that we may come up short.  And, when I review the count for the GDX, there does not seem like there is much more upside to be seen, which also makes me more concerned about the metals.

For now, we are in the wave iii off the recent lows, and we still need a wave (5) of iii to complete that structure.  As long as GLD holds the 114.90 level, I am going to continue to look higher towards the next resistance region around the 118 level.  That would complete wave iii for me, unless we see significant extensions in (5) of iii.  Should wave iii top around 118, the entire structure we have been watching may very well top in the 120 region, which would present us with the yellow (b) wave top noted on our daily chart.

As for silver, my minimum target at this time would be the 17.75 level, with the potential to still exceed the 18 level, again, all depending upon extensions.  But, when this 5 wave structure completes, I will likely begin to look to the short side of the market.  Let’s see how the next week plays out.

BaseCase - GLD8min
BaseCase - GLD8min
BaseCase - GLD
BaseCase - GLD
BaseCase - GDX
BaseCase - GDX
Silver Daily
Silver Daily
Avi Gilburt is founder of ElliottWaveTrader.net.