The correction started today as I speculated yesterday and so far it does not look impulsive. So I am assuming we will have a "Zig Zag" to a proper Fibonacci retracement (perhaps the rising trend average) and then put in another bullish 5 waves. I labeled the low today as an "A" and we're currently working on a "B" leg which probably ended today or will end tomorrow/Thursday before another leg down. If that leg down after the B is a major sell off then I'll label it as a W3 as there will be follow thru selling. In the meantime, I am keeping longs intact and holding on to my shorts to cover at the "C" leg.
On a side note, Gold seems to be either back testing it's bearish trend line but if it holds, then there will be a 13/34 cross over and it will be a good bullish trade as inflation is set to appear later this year and gold will be used as an hedge. The bullish wave from its August low has retraced to the expected Fib level so it will probably launch on a big Wave 3 to much higher highs. I expect the stock market to parallel Gold's waves, so we'll probably see a similar correction to the 1180-1215 area on the S&P (assuming there is a top at 1325, which is inconclusive at this point) and then launch again.
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