GLD breaks out of first threat.

The conventional wisdom model is that GLD is doing a large a-b-c retracement of the entire gold bear that began in 2011.  That was a big bear and so it should require a big bounce.  What I see so far just doesn't look like it is part of a super bounce.  At least not yet.  So it is worthwhile to think about sell triggers while M+M climb the so called wall of worry.

In this post I recommended to keep an eye on the declining double top  shown there.  The current chart shows that this DDT has been broken out of albeit in slo mo.  The momo traders are certainly not in any of the M+M shares yet.  The blue like below show where that resistance was.

But we are not in the clear yet even though I expect to see several days of strength ahead as people see this breakout and want to trade it.  And just when they are all frothy and giddy is when I would, were I Mr. Market, reverse downward on them and go into a nose dive.  The wave count that would do exactly that to them is shown below.  The great thing about this threat is that it is 100% observable.  In order for this to play out, the 4th wave would likely throw over the top rail of the HT (but it could also just kiss it) and then turn down as shown.  IFF it breaks out, the sell first and ask questions later event is the break back down into the channel.  IFF it just kisses the rail and then begins to head down I would just sell and only buy back on a break out of the top rail.

This is not the conventional wisdom model but since nobody in the EW community that I follow seems to be talking about it, I think it is worth watching.  But treat it as a potential threat monitor and not a primary model at this point.  The dollar seems so very stretched in its wave count that despite the choppy shape of the chart so far, the primary count is still bullish.