By David Banister of TheMarketTrendForecast.com

NEW YORK ( TheMarketTrendForecast.com) -- My most recent forecasts for the S&P 500 and gold have been calling for interim peaks in both around mid-January. Gold, I told my subscribers a few weeks ago, was definitely topping and likely to drop to $1270-$1280 per ounce before resuming its bull market advance. For the S&P 500, I have been forecasting a 1285-1315 topping area since the 1175 pivot lows on that index, and we are very close as well in that regard.

Gold has been in a 9-plus-year bull market since 2001 and has another three-plus years left on this bull run. However, pauses must occur along the way, and this should be a 4th wave corrective Elliott pattern if my views are right.

This is taking the form of a 3-3-5 correction from the $1430 top. We are in the final five waves down now, and it's about to get ugly near term, so strap on your seatbelts. My chart forecast is below, and if I'm right, there will be excellent opportunities to pick up some good juniors and also the precious metals themselves around that $1270-$1280 area. Following this correction, we could have a run to about $1515 per ounce, and I expect this entire pattern to take six months to a year to play out from the $1430 top to the $1270-ish bottoms, and back to $1515.

The S&P 500 is completing the final 5th wave movement from the 1010 July 1 lows of this past summer. This is only the first full wave pattern movement of a big 5-wave leg up from July 1. What this means in English is we have a near-term top likely in the 1285-1315 areas, followed by a wave 2 correction to around the 1175-1180 areas. Sentiment right now is running at major extremes last seen at interim peaks in January of 2010 and April of 2010, where I had also forecast tops within days of the peaks. I am looking for the SP 500 to end up around 1600 on the index after this coming wave 2 correction, but I like to take it one pivot and step at a time. Below is my forecast using a chart:

This commentary comes from an independent investor or market observer as part of TheStreet guest contributor program. The views expressed are those of the author and do not necessarily represent the views of TheStreet or its management.

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