User: TWT: LONG TERM EWP: KOL (Coal etf): Analysis of the EWP | The wave trading

I will begin to monitor KOL

Despite the big picture does not look bullish at all since 2 obvious patterns stand out in the weekly chart below:

Hence if one of the two patterns is playing out then price should be on the verge of resuming the downtrend.

However weekly momentum is suggesting that price could have established a longer-term bottom at the September 2012 low and a different pattern is forming.

So if we have bullish weekly momentum then there should be a bullish pattern.

Actually if we look at the price pattern from the end of May 2012 we can see that price has been establishing a base that could be unfolding an Inverted H&S and allow a large countertrend rebound with a potential target at the 0.618 retracement of the down leg off the February 2012 peak

In addition we can make the case that price from the November 16 higher low has began a large impulsive wave (C) up with the first impulsive sequence completed last Monday

If this count is correct then the current pullback has to be corrective (So far it is to soon to confirm it).

The obvious (sweet spot) for a wave (2) pullback is located at a large gap up & 0.382 retracement = 25.14 – 25.03

So this is not a buy now set up, instead it is worth monitoring the internal structure of the pullback and look for a reversal pattern as/if it approaches the gap fill of the rising trend line off the September low

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