This is the December 2016 contract and chances are good I will stay with this month until the end November 2016. The traffic will increase as we go on, which will fill out the wave structure better.
At this time I am expecting a correction at a possible wave 2 in Minute degree, which eventually should get us to a wave "A" in Minor degree. There is very little leeway that I can allow as impulse waves are pretty finicky patterns that don't take kindly to cheating or wave count forcing.
What I will be looking for is any wave pattern that supports a corrective pattern, then we are more likely to get another leg added on to this trip
,which started on December the 20th.
Any correction down to the $37 price level I would find acceptable, but anymore than that would indicate a very weak potential run. Another zigzag would be alright, but a flat, will indicate another strong leg.
Any gold/oil ratio I will use the two December 2016 months as my base which gives us a gold/oil ratio right now of just about 28:1. This is a big shift from what it was, so we know that oil has come off its extreme oversold condition.
I may be bearish in the short term, but much more bullish in the long term.