6:16 am PST. /DX bouncing off a pivot support.

5:37 am PST. Nice. Gold is up $17.10 this morning. I think we will surpass $1243.20 soon, which was my level of confirmation for a new bull market wave 3 higher. $1243.20 was the bottom of wave 1 down of the correction. In Elliot wave speak, wave 4 cannot overlap wave 1 if the market intends to do another impulsive wave further down – in this case to below $1000. If we overlap $1243.20, that means no more impulsive wave down and gold is in a new major wave 3 higher. Typically what happens is that prices will overlap the wave 1 bottom, retrace a little, then continue the march higher. We have not yet overlapped $1243.20, so another wave down to below $1000 is still possible, but looking at the mining stocks gives us a lot of clues. I think the mining stocks say gold is in a new wave 3 up.

The dollar could waterfall from here.

My horizontal line shows the overlap confirmation point.