Not A Lot To Add Right Now

At this point in time, I really cannot say if the market is ready to break out just yet or not. 

While the GDX began to rally a off the .618 retracement of the prior rally off wave iv, I still do not have a clear 5 wave structure off that low.  That means that this corrective action may still have one more decline to just below the 27 region before the market may be ready to break out.  Or, we see just a bit higher to complete 5 waves up off the .618 extension, which I will count as wave (1) of a wave (iii) of v of (3) extension.

But, as I have said so many times, I cannot confidently view the market as truly moving much higher until we see a strong move through the pivot noted on the chart.  Once the market moves through that pivot, you can set your short term stops just under the pivot, and as long as we remain over that pivot on all pullbacks, I will be targeting the 35-37 region on GDX, as discussed over the weekend.

Therefore, the same applies to GLD and silver.  Meaning, that nothing has really changed just yet.  And, until I have a clear 5-wave structure off the recent lows, I have no clear indication that the market is getting set to break out in another rally.

Alternatively, should the market break cited support levels, it would strongly suggest we have begun a much longer and deeper correction, as presented by the yellow wave ii in the various charts, as also discussed over the weekend.

There is one more point I do want to add this evening, which I mentioned in my live video this morning.

For some time, I had been wondering why the GDXJ seemed to be one wave degree behind the rest of the complex.  But, at this point in time, should we see the next rally that I am tracking as my primary count (as long as the market maintains over support), then the GDX will be completing its wave (3) of 3, just as all the other charts will be doing the same.  This gives me a bit more confidence in the potential for this count to play out.

But, again, should the market break cited support levels, I will have to move to my alternative count.  For now, I remain cautiously optimistic again for another rally to take hold, but we need a better set up to be a bit more confident that the market is about to embark on another strong rally higher.

GDX-8min
GDX-8min
GDXdaily
GDXdaily
GDXJ
GDXJ
GLD-daily
GLD-daily
silver144min
silver144min
Avi Gilburt is founder of ElliottWaveTrader.net.