SLV has hit my modeled wave 4 of C target; GLD breakout?

In this post I provided my updated wave count for SLV.  That model predicted a vee style bounce to touch the top channel line from below.  I expected a slightly sharper bounce that would have hit the top channel at a slightly higher price than today but with Elliott waves the wave count and the wave shape are more important than price targets or timing.

I'm posting again right now because the model is at a major testing point.  If the model breaks out of the upper channel and holds it then my recent model is likely incorrect but if the top resistance line holds then I expect one final wave down that would likely form an inclining double bottom before taking off for good.

A few things should be noted at this point:

• The standard EW model would have the chart hitting the lower channel line again.  I personally don't think buyers will be able to wait that long but if it happened then it would be perfectly acceptable from a modeling standpoint.
• One of the big values of modeling is making predictions that include trigger levels.  If a trigger level is hit then the modeler can assume the model is wrong.  Because of this feature, EW modelers never just assume their model will play out fully.  One trigger for the current model is to reasonably hold the upper channel right now in order to form the expected 4th wave.  If this does not hold then the model needs to be reviewed and possibly revised.
• The risk at the end of the 5th wave down is to the upside.  In other words, I would not short SLV here hoping to catch the final few dollars of potential downside just because the model indicated it was the highest probability thing to happen.  It's just too late for that now.  The chart could break out here.  Right now is the time to be looking for an entry point long, not an entry point short.
• I expect GLD and SLV to move in somewhat similar ways.  Today GLD might have just broken out of its top channel (see chart below). If this is true then I'll have to adjust its wave count as shown below meaning the 5th of C wave is already played out and we are now working on 3 of 1 of a new bull market.  The breakout on a gap up is some evidence but not yet conclusive.  But taken in conjunction with all of the other news (people bad mouthing gold, calling it "risky", gold mining capacity being shut down all over the world because it is not profitable at this level, etc.) it would not surprise me at all if the bottom is already in for GLD.
• Hoping to catch the exact bottom is always fun but realistically, GLD has been in buying territory since it broke below $130.  At the end of the day, those who dollar cost average into their position will not be disappointed.

One final note on gold and silver in general.  People are worried that "tapering" of the stimulus will make the dollar worth more and thus cause gold and silver to go down.  This thinking is driven by the foolish belief that gold is a commodity.  But gold is not a commodity.  It is not used to any significant degree by industry.  Gold is money.  In fact, it is the only real money in existence.  Silver is a close second to gold in historical monetary status but silver has a commodity use as well.

It will pay people to consider the implications of this important distinction between being a commodity and being money.  If the fed continues to stimulate (i.e. debase the USD) then all competing currencies (including gold) will go up on a relative basis right along with commodities.  But if the fed does decide to brave the depression that is sure to come if they do cut back on treasury purchases or, God forbid, try to actually sell some of the worthless US bonds on its books, then interest rates will skyrocket, the housing and commercial real estate markets will collapse and banks will default.  This will cause great financial panic (AKA a return to reason).  The panic will tell people that all paper assets are risky.  As a result, people and corporations will be looking for a safe haven for their savings away from the defaulting paper based assets.  That is why I am predicting that corporations will begin to show gold on their books as assets for the first time since gold confiscation occurred in 1933.

In other words, everyone will pile into gold in either the inflationary or deflationary case IMO.  There is no scenario going forward which I can envision in which gold (and silver as well) will be treated as "risky" assets going forward.  Both of these metals will return to their historical place of reverence as the ultimate store of wealth in the financial world.