Monthly Archives: July 2013

GOLD Elliott Wave Technical Analysis – 24th July, 2013

Last analysis expected choppy overlapping movement to 1,192.45 or below in the short to mid term. Overall the wave count expected further upwards movement for a fourth wave correction at intermediate degree.

Price did not move lower, it moved higher. The most likely structure, a flat correction, is not the structure unfolding for this fourth wave.

Click on the charts below to enlarge.

Gold Elliott Wave Chart Daily 2013

This daily chart focuses on the new downwards trend of primary wave C.

Within primary wave C intermediate waves (1) through to (3) are complete.

Intermediate wave (4) may last about three to six weeks, depending upon what structure it takes. Intermediate wave (2) lasted three weeks and was a deep 66% zigzag. Intermediate wave (4) so far has lasted almost three weeks and I would expect it is incomplete.

Intermediate wave (4) may end at either the 0.236 or 0.382 Fibonacci ratios. When there is more structure within this fourth wave to analyse then a target for it to end may be calculated.

Intermediate wave (4) may find resistance at the upper edge of the parallel channel drawn here using Elliott’s first technique. Draw the first trend line from the lows of intermediate waves (1) to (3), then place a parallel copy upon the extreme within intermediate wave (3).

Within intermediate wave (4) movement should be very choppy and overlapping. At this stage it looks like it may be unfolding as a zigzag or a double with the first structure a zigzag, because so far minor wave A subdivides as a completed five wave impulse. Within the zigzag minor wave B may not move beyond the start of minor wave A. This wave count is invalidated in the short term with movement below 1,180.40.

At 1,151 primary wave C would reach 1.618 the length of primary wave A. This target is a long term target. When we know where intermediate wave (4) has ended within primary wave C then we may use a second wave degree to also calculate this target, so it may widen to a zone or may change.

Within primary wave C intermediate wave (4) may not move into intermediate wave (1) price territory. This wave count is invalidated with movement above 1,672.77.

GOLD Elliott Wave Chart Hourly 2013

At this stage we now have a clear five wave structure upwards within minor wave A indicating intermediate wave (4) is unfolding as a zigzag or a double with the first structure a zigzag.

Ratios within minor wave A are: minute wave iii is 5.41 longer than equality with minute wave i, and minute wave v has no Fibonacci ratio to either of minute waves i or iii.

Ratios within minute wave v are: minuette wave (iii) has no Fibonacci ratio to minuette wave (i), and minuette wave (v) is just 0.38 longer than 0.382 the length of minuette wave (iii).

Within minor wave B it is possible the structure is complete, but it is also possible that it will move lower. On the five minute chart the small upwards movement following the low labeled minor wave B does not subdivide nicely as a five wave structure, so this may be a correction within a larger downwards movement for minor wave B.

When price turns and moves above 1,338.62 then minor wave B is most likely to be over and minor wave C should be underway.

Use Elliott’s technique to draw a parallel channel about intermediate wave (4). Draw the first trend line from the start of minor wave A to the end of minor wave B, then place a parallel copy upon the end of minor wave A. Expect minor wave C to end about the upper trend line.

If minor wave B moves lower then redraw the channel.

Overall I expect this structure to take a few more days to complete. It may find resistance a the upper edge of the channel drawn on the daily chart.

 

US OIL Elliott Wave Technical Analysis – 23rd July, 2013

Oil has moved higher as expected for the week, remaining just below the invalidation point. If price breaks above 110.56 in the next one to few weeks this wave count will change significantly. I will briefly cover the alternate for this scenario today.

Click on the charts below to enlarge.

US Oil Elliott Wave Chart Daily 2013

Intermediate wave (2) is most likely now a complete zigzag. There is a nice evening doji star candlestick pattern at the high of intermediate wave (2) indicating a trend change.

Within intermediate wave (2) minor wave C has no Fibonacci ratio to minor wave A.

Ratios within minor wave C are: minute wave iii has no Fibonacci ratio to minute wave i, and minute wave v is just 0.06 longer than 0.382 the length of minute wave i.

When the wide parallel channel containing intermediate wave (2) is breached then we shall have trend channel confirmation of this trend change.

Within intermediate wave (2) minor wave 2 may not move beyond the start of minor wave 1. This wave count is invalidated with movement above 108.92.

US Oil Elliott Wave Chart Hourly 2013

The structure within intermediate wave (2) may again be considered complete. Price did not move lower as expected to complete minute wave iv last week, it moved sideways to complete a triangle. Within the triangle on the five minute chart minuette wave (e) itself subdivides nicely into a contracting triangle.

There is perfect alternation between minute waves ii and iv; minute wave ii was a deep sharp zigzag, minute wave iv is a time consuming sideways moving shallow triangle.

The channel drawn about the impulse of minor wave C is now very clearly breached indicating intermediate wave (2) is probably over and intermediate wave (3) has likely just begun.

Ratios within minute wave v are: minuette wave (iii) is just 0.01 short of 2.618 the length of minuette wave (i), and minuette wave (v) is exactly 1.618 the length of minuette wave (i). With these remarkably good Fibonacci ratios I am confident this labeling of minute wave iv triangle and minute wave v impulse is correct.

Within the new downwards movement we do not have a clear five down. This movement so far does not subdivide into a leading diagonal because the first wave down labeled subminuette wave i itself subdivides into a diagonal on the five minute chart.

Within subminuette wave iii if micro wave 2 were to move higher it may not move beyond the start of micro wave 1. This wave count is invalidated at minute wave degree with movement above 108.58.

Alternate Monthly Wave Count.

US Oil Elliott Wave Chart Monthly Alternate 2013

If price moves above 110.56 in the next week this is the wave count I would use.

It is possible that cycle wave b is not over and is completing a double zigzag, with primary wave X within it a contracting triangle.

The triangle of primary wave X does fit, in that all the waves within it can be seen as threes, but it does not have a very typical look for a contracting triangle. The overshoot of the B-D trend line within intermediate wave (E) looks strange. For this reason I would judge this wave count to have a low probability. I would only consider it seriously if it was confirmed with price movement above 110.56.

If this wave count is confirmed we should expect a continuation of upwards movement from oil for some months yet. There is not normally a Fibonacci ratio between subwaves W and Y within doubles, and so a target for primary wave Y to end could only be calculated when intermediate waves (A) and (B) within it are complete.

Cycle wave b may not move beyond the start of cycle wave a. This wave count is invalidated with movement above 146.73.

 

GOLD Elliott Wave Technical Analysis – 17th July, 2013

Last analysis expected a little more upwards movement from gold to one of two targets, 1,296 or 1,349, before a short term trend change. The trend change would be confirmed with movement below 1,267.60.

Price did move a little higher to 1,300.93, $4.93 above the first target, and may have turned down. We do not have confirmation of this short term trend change yet. We may use the channel on the hourly chart and 1,267.60.

Click on the charts below to enlarge.

Gold Elliott Wave Chart Daily 2013

This daily chart focuses on the new downwards trend of primary wave C.

Within primary wave C intermediate waves (1) through to (3) are complete.

Intermediate wave (4) may last about three to six weeks, depending upon what structure it takes. Intermediate wave (2) lasted three weeks and was a deep 66% zigzag. Intermediate wave (4) so far has lasted almost three weeks and I would expect it is incomplete. It is most likely to be a relatively shallow flat, triangle or combination. All these structures are more time consuming than a brief zigzag.

Intermediate wave (4) may end at either the 0.236 or 0.382 Fibonacci ratios. When there is more structure within this fourth wave to analyse then a target for it to end may be calculated.

Intermediate wave (4) may find resistance at the upper edge of the parallel channel drawn here using Elliott’s first technique. Draw the first trend line from the lows of intermediate waves (1) to (3), then place a parallel copy upon the extreme within intermediate wave (3).

Within intermediate wave (4) movement should be very choppy and overlapping. If it unfolds as a running triangle or an expanded flat then within it minor wave B may make a new low below 1,180.40.

At 1,151 primary wave C would reach 1.618 the length of primary wave A. This target is a long term target. When we know where intermediate wave (4) has ended within primary wave C then we may use a second wave degree to also calculate this target, so it may widen to a zone or may change.

Within primary wave C intermediate wave (4) may not move into intermediate wave (1) price territory. This wave count is invalidated with movement above 1,672.77.

GOLD Elliott Wave Chart Hourly 2013

Within intermediate wave (4) minor wave A is probably now complete.

Within minor wave A minute wave c is 5.41 longer than equality with minute wave a.

Ratios within minute wave c are: minuette wave (iii) is 4.22 longer than equality with minuette wave (i), and minuette wave (v) is just 0.71 longer than 0.618 the length of minuette wave (i).

We need to see this parallel channel drawn about minor wave A clearly breached by downwards movement to have confidence in this short term trend change.

If intermediate wave (4) is unfolding as a flat correction then within it minor wave B must reach to a minimum of 90% the length of minor wave A at 1,192.45. Minor wave B may make a new low below the start of minor wave A at 1,180.40 and in fact is reasonably likely to do so because the most common type of flat is an expanded flat which would require minor wave B to reach 105% the length of minor wave A at 1,174.37.

If the next downwards movement fails to reach 1,192.45 or below then there are other structural possibilities for intermediate wave (4). It may be unfolding as a contracting or barrier triangle, or it may be a double zigzag, or a double combination.

All the structural possibilities for intermediate wave (4) at this stage require a three wave structure to unfold downwards which should last a few days and should take price below the parallel channel drawn here on the hourly chart.

 

GOLD Elliott Wave Technical Analysis – 10th July, 2013

Last week’s analysis of gold expected choppy, overlapping movement for the continuation of an intermediate degree fourth wave correction, which is pretty much what we have seen.

It is too early to be certain of what structure is unfolding for intermediate wave (4), but it is most likely that it is incomplete.

Click on the charts below to enlarge.

Gold Elliott Wave Chart Daily 2013

This daily chart focuses on the new downwards trend of primary wave C.

Within primary wave C intermediate waves (1) through to (3) are complete.

Intermediate wave (4) may last about three to six weeks, depending upon what structure it takes. Intermediate wave (2) lasted three weeks and was a deep 66% zigzag. Intermediate wave (4) may last three or more weeks and is most likely to be a relatively shallow flat, triangle or combination.

Intermediate wave (4) may end at either the 0.236 or 0.382 Fibonacci ratios. When there is more structure within this fourth wave to analyse then a target for it to end may be calculated.

Intermediate wave (4) may find resistance at the upper edge of the parallel channel drawn here using Elliott’s first technique. Draw the first trend line from the lows of intermediate waves (1) to (3), then place a parallel copy upon the extreme within intermediate wave (3).

Within intermediate wave (4) movement should be very choppy and overlapping. If it unfolds as a running triangle or an expanded flat then within it minor wave B may make a new low below 1,180.40.

At 1,151 primary wave C would reach 1.618 the length of primary wave A. This target is a long term target. When we know where intermediate wave (4) has ended within primary wave C then we may use a second wave degree to also calculate this target, so it may widen to a zone or may change.

Within primary wave C intermediate wave (4) may not move into intermediate wave (1) price territory. This wave count is invalidated with movement above 1,672.77.

GOLD Elliott Wave Chart Hourly 2013

So far within intermediate wave (4) minor wave A may be an incomplete zigzag.

If minor wave A is unfolding as a zigzag then it is termed a “three”, which indicates either a flat or triangle unfolding for this fourth wave.

Within minor wave A zigzag minute wave c would reach equality in length with minute wave a at 1,296. If price gets up to this first target and the structure of minor wave c is incomplete, or if it just keeps going through this first target, then the second target is at 1,349 where minor wave c would reach 1.618 the length of minor wave a.

Thereafter, minor wave B should move to at least 90% the length of minor wave A and may make a new low.

If the next movement downwards moves below 1,267.60 then the upwards movement labeled minor wave A will be confirmed as a complete three wave zigzag because at that stage downwards movement may not be a fourth wave correction within a new impulse unfolding upwards.

If the next movement downwards which is expected to be minor wave B fails to reach a minimum of 90% the length of minor wave A then a double zigzag or double combination may be unfolding.

At this stage it is too early to determine exactly which structure is unfolding for intermediate wave (4); it may be a flat, triangle, double or triple.

When the channel about minor wave A is clearly breached by downwards movement we shall have an indication that the upwards zigzag is complete and the next wave downwards is underway.

When this current five wave impulse upwards is complete then the next downwards movement will illustrate what structure may be unfolding for intermediate wave (4). If the next movement breaches 1,267.60 then the upwards movement labeled minor wave A must be a completed three wave structure and intermediate wave (4) may be a flat, triangle or double. If the next downwards movement does not reach below 1,267.60 then minor wave A may be unfolding as a five wave impulse and intermediate wave (4) may be unfolding as a zigzag.

Intermediate wave wave (4) may not move into intermediate wave (1) price territory. This wave count is invalidated with movement above 1,672.77.

 

GOLD Elliott Wave Technical Analysis – 3rd July, 2013

Last week’s analysis of gold expected upwards movement from a low of 1,221.88. Price moved lower first to reach down to 1,180.40, $41.48 below where I had expected the low to be.

However, we did not see a trend channel breach on the hourly chart and did not have confirmation that a low was in place, until after price moved lower. With a very clear channel breach now we may be more confident that gold is in an upwards correction to last a few more weeks.

Click on the charts below to enlarge.

Gold Elliott Wave Chart Daily 2013

This daily chart focuses on the new downwards trend of primary wave C.

Within primary wave C intermediate waves (1) and (2), and possibly also (3), are complete.

Intermediate wave (3) is now 51.96 longer than 4.236 the length of intermediate wave (1). Although this is a big difference because these waves are at intermediate wave degree the difference is 9%. I consider less than a 10% variation an acceptable Fibonacci ratio.

Ratios within intermediate wave (3) are: minor wave 3 is 21.24 longer than 2.618 the length of minor wave 1, and minor wave 5 is 22.23 longer than 0.618 the length of minor wave 3.

Intermediate wave (4) may last about three to six weeks, depending upon what structure it takes. Intermediate wave (2) lasted three weeks and was a deep 66% zigzag. Intermediate wave (4) may last three or more weeks and is most likely to be a relatively shallow flat, triangle or combination.

Intermediate wave (4) may end at either the 0.236 or 0.382 Fibonacci ratios. When there is more structure within this fourth wave to analyse then a target for it to end may be calculated.

Intermediate wave (4) may find resistance at the upper edge of the parallel channel drawn here using Elliott’s first technique. Draw the first trend line from the lows of intermediate waves (1) to (3), then place a parallel copy upon the extreme within intermediate wave (3).

At 1,151 primary wave C would reach 1.618 the length of primary wave A. This target is a long term target.

Within primary wave C intermediate wave (4) may not move into intermediate wave (1) price territory. This wave count is invalidated with movement above 1,672.77

GOLD Elliott Wave Chart Hourly 2013

So far we have a very clear trend channel breach of the downwards movement labeled intermediate wave (3). We may consider this confirmation that the downwards impulse is now over and an upwards correction at intermediate degree has begun.

Given the guideline of alternation intermediate wave (4) is most likely to be (in order of probability) a flat, combination or triangle.

At this stage minor wave A within it may be an incomplete three wave structure. If intermediate wave (4) is unfolding as a flat then minor wave A within it is most likely to be a zigzag. At 1,324 minute wave c would reach equality in length with minute wave a.

Ratios within minute wave a are: minuette wave (iii) has no Fibonacci ratio to minuette wave (i), and minuette wave (v) is just 1.19 short of 1.618 the length of minuette wave (i).

Ratios within minuette wave (v) are: subminuette wave iii has no Fibonacci ratio to subminuette wave i, and subminuette wave v is just 0.54 short of 0.618 the length of subminuette wave iii.

Within the zigzag of minor wave A minute wave a is complete. Minute wave b may be complete, or it may yet move price lower. If it does then it may not move beyond the start of minute wave a. Movement below 1,180.40 in the short term (before minor wave A is a clearly complete zigzag) would invalidate this wave count at minor wave degree.

When minor wave A is complete then minor wave B should move down to at least 90% the length of minor wave A, and is likely to make a new low below the start of minor wave A at 1,180.40 because the most common type of flat is an expanded flat and this requires minor wave B to be a minimum of 105% the length of minor wave A.

Overall intermediate wave (4) should be choppy, overlapping and should last another two to four weeks.