Crude oil reversed sharply from around 92.50 yesterday where could be the low of an ending diagonal if we consider a strong reversal from the lower side of a wedge pattern. Based on current development we suspect that market will reversing former swing high around 95.40.
Yesterday, we were also tracking gold as we were looking for some bullish waves after Janet Yellen testimony. On the hourly chart we know have five waves up, which we think it represents only first leg of a minimum three wave rally up in ii). Keep in mind that second waves are corrective, so they must be made by three subwaves before contra-trend move can be finished. With that in mind we believe that gold will reach 1305-1326 region early next week, before market turns down again.
Written by www.ew-forecast.com