Monthly Archives: November 2013

GOLD Elliott Wave Technical Analysis – 29th November, 2013

Yesterday’s analysis had a main and alternate wave count which I judged to have an even probability. Upwards movement for Friday has taken Gold outside of the parallel channel on the daily chart. This is the first thing I was looking for to indicate which wave count is correct.

For the end of week analysis I can now state I judge the main wave count to have a higher probability than the alternate.

The alternate remains valid, but the probability that it is correct has reduced.

Continue reading GOLD Elliott Wave Technical Analysis – 29th November, 2013

GOLD Elliott Wave Technical Analysis – 28th November, 2013

Yesterday’s analysis expected more upwards movement from Gold. Price has moved higher, but it is not a convincing third wave… yet.

I have the same main wave count with now two alternates at the daily chart level. The first alternate may be used if confirmed with movement below 1,225.40. The second alternate expects the same movement as the main wave count.

*Edit: While price remains within the pink parallel channel on the daily chart, and above 1,234.68, then the main wave count and the first alternate have an even probability.

Click on the charts below to enlarge.

Main Wave Count.

Gold Elliott Wave Chart Daily 2013

Gold is still within a large fourth wave correction at primary wave degree which is incomplete. It is unlikely that primary wave 4 was over at 1,433.83 as a single zigzag because it would have lasted only nine weeks. Its counterpart primary wave 2 lasted 53 weeks. This is too big a difference for the wave count to have the “right look”.

It is likely to continue as a double combination because within it intermediate wave (X) is reasonably deep. Double zigzags normally have more shallow X waves than this one is.

The purpose of double combinations is to take up time and move price sideways, and I would expect intermediate wave (Y) to end about the same level as intermediate wave (W) at 1,433.83. Double combinations in fourth wave positions are quite common.

I have drawn a parallel channel about the zigzag of intermediate wave (X) using Elliott’s technique for a correction. Draw the first trend line from the start of minor wave A to the end of minor wave B. Place a parallel copy upon the end of minor wave A. Minor wave C may have ended slightly short of touching the lower edge of the channel. When this channel is finally breached by upwards movement then I would consider that final confirmation that intermediate wave (Y) is underway.

I have also drawn a parallel channel about minor wave C downwards using Elliott’s second technique. Draw the first trend line from the highs labeled minute waves ii and iv, place a parallel copy upon the low labeled minute wave iii. Confirmation of a trend change would come with a clear breach of this channel by upwards movement.

Primary wave 4 may not move into primary wave 1 price territory. This wave count is invalidated with movement above 1,532.90.

GOLD Elliott Wave Chart Hourly 2013

Price has moved higher as expected, but it is so far unconvincing as a third wave. It may be that with the USA closed for Thanksgiving holidays the markets are quiet, and the first wave within minuette wave (iii) may be a slow moving first wave.

Initially I would want to see movement above the pink parallel channel containing minor wave C downwards to have some confidence in a trend change.

Thereafter, movement above 1,255.01 would give further confidence in a trend change. At that stage upwards movement may not be a second wave correction within a continuing downwards trend.

Movement above 1,261.52 would give me full and final confidence in a trend change. At that stage the first alternate daily wave count below would be invalidated.

I have moved the invalidation point for this main wave count up today just for the hourly chart. If minuette wave (iii) has begun then within it subminuette wave ii may not move beyond the start of subminuette wave i. This wave count is invalidated with movement below 1,234.68.

If price moves below 1,234.68 at this stage it is still possible that minuette wave (ii) is continuing lower, but this has a low probability. Minuette wave (ii) would then be much longer in duration than minuette wave (i) which would give the wave count an odd look. However, it is a slim possibility that minuette wave (ii) would be continuing as a double combination, and I would consider that possibility. The invalidation point for this is the same as on the daily chart, 1,225.40.

First Alternate Wave Count.

Gold Elliott Wave Chart Daily Alternate 2013

This alternate is mostly the same as the main wave count except it sees minute wave iii within minor wave C extending. At 1,206 minor wave C would reach equality in length with minor wave A.

Within the extending third wave of minute wave iii, minuette wave (iv) may not move into minuette wave (i) price territory. This alternate would be invalidated above 1,261.52.

If price moves above 1,261.52 then I would have full confidence in the main wave count, and I would expect that gold is in a new upwards trend to last for weeks.

Gold Elliott Wave Chart 2 Hourly Alternate 2013

This wave count agrees with MACD as it sees the strongest downwards momentum within a third wave. However, I have noticed with Gold that typical of commodities it sometimes has fifth waves which may be slightly stronger than third waves. Because this difference in momentum (indicated by the two horizontal lines in colour on MACD) is not very great I must state that it is inconclusive. Both wave counts fit.

At this stage today I must state that it is my opinion that the main wave count and this alternate have about an even probability. I will wait for confirmation of one and invalidation of the other before I get off the fence and again have a clear preference. Price will show us which wave count is correct, and it should do this within another couple of days.

Second Alternate Wave Count – Triangle.

Gold Elliott Wave Chart Daily Alternate Triangle 2013

It is also possible that primary wave 4 may continue as a regular contracting (or barrier) triangle.

The expected direction and structure of this next upwards wave is the same, but for this alternate intermediate wave (C) of the triangle may not move beyond the end of intermediate wave (A). The triangle is invalidated with movement above 1,438.83.

If the triangle is contracting then the following downwards wave for intermediate wave (D) may not move beyond the end of intermediate wave (B) at 1,225.40.

If the triangle is a barrier triangle then intermediate wave (D) may end about the same level as intermediate wave (B) at 1,225.40, as long as the B-D trend line is essentially flat. What this means in practice is that intermediate wave (D) could end slightly lower than 1,225.40. This is the only area where Elliott wave rules are not black and white.

The final intermediate wave (E) upwards may not move above the end of intermediate wave (C) for both a contracting and barrier triangle. E waves most commonly end short of the A-C trend line.

All five subwaves of a triangle must divide into corrective structures. If this next upwards movement subdivides as a zigzag which does not make a new high above 1,438.83 then this alternate would be correct.

Triangles take up time and move price sideways. If primary wave 4 unfolds as a triangle then I would expect it to last months rather than weeks.

SILVER Elliott Wave Technical Analysis – 27th November, 2013

Last week’s analysis of Silver expected more downwards movement towards a target at 18.591 to 18.353. Price did move lower but has failed to reach the target. Downwards movement may have ended at 19.595, 1.004 short of the target zone.

The wave count remains mostly the same.

Click on the charts below to enlarge.

SILVER Elliott Wave Chart Daily 2013

Minor wave B is now a complete zigzag.

Within minor wave B minute wave a subdivides nicely as a leading expanding diagonal. Within the leading diagonal all the subwaves are zigzags except the third wave which is an impulse. For this piece of movement this structure has the best fit.

Minute wave b is labeled as an expanded flat correction. Within it minuette waves (a) and (b) both subdivide as three wave zigzags, and minuette wave (b) is a 106% correction of minuette wave (a). There is no Fibonacci ratio between minuette waves (a) and (c).

Minute wave c is now a complete impulse. Within minute wave c there are no adequate Fibonacci ratios between minuette waves (i), (iii) and (v).

The narrow channel drawn about minute wave c is drawn using Elliott’s first technique. Draw the first trend line from the ends of minuette waves (i) to (iii), then place a parallel copy upon the end of minuette wave (ii). This channel is now clearly breached by upwards movement which indicates minute wave c is over and the next wave has begun. The upper edge of the channel is now providing support.

Within minor wave C no second wave correction may move beyond the start of its first wave. This wave count is invalidated with movement below 19.595.

At 26.50 minor wave C would reach equality in length with minor wave A.

SILVER Elliott Wave Chart Hourly 2013

What is very clear on this hourly chart is the three wave structure for recent downwards movement. If price does not break below 19.595 then I would expect a third wave upwards to begin from here.

Upwards movement for minuette wave (i) is very clearly an impulse. Ratios within minuette wave (i) are: there is no Fibonacci ratio between subminuette waves iii and i, and subminuette wave v is just 0.006 short of 0.618 the length of subminuette wave iii.

Within minuette wave (ii) subminuette wave c is 0.031 short of equality with subminuette wave a.

At 20.820 minuette wave (iii) would reach 1.618 the length of minuette wave (i).

The channel about minuette waves (i) and (ii) is an acceleration channel. I would expect minuette wave (iii) to break through the upper edge of this channel. At that stage I would be confident that a third wave is underway.

GOLD Elliott Wave Technical Analysis – 27th November, 2013

Yesterday’s analysis expected upwards movement for a third wave to begin towards a target at 1,286. The target was expected to be one to two days away.

Price did move a little higher, but thereafter moved to a slight new low. The third wave has not yet begun. Price remains well above the invalidation point, and the wave count is only slightly changed.

Continue reading GOLD Elliott Wave Technical Analysis – 27th November, 2013

US OIL Elliott Wave Technical Analysis – 26th November, 2013

Last week’s US Oil analysis expected more downwards movement towards 89.83 for the end of a third wave. Price did not move lower. Instead, it has moved a little higher and sideways. The third wave was already over, and sideways and higher movement is the following fourth wave.

Overall the wave count is not much changed on the daily chart. The structure of this long impulse is still incomplete and I will still expect some more downwards movement.

Click on the charts below to enlarge.

US Oil Elliott Wave Chart Daily 2013

The bigger picture sees US Oil in a new downwards trend to last from one to several years. When I can see a clear five wave structure downwards on the daily chart I will have confidence in a trend change at cycle degree. So far the downwards structure for the first wave at minor degree is incomplete, and I cannot say that there is yet a clear five down.

Within the downwards movement the strongest downwards momentum is within the third wave. Minute wave iii is over and was just 0.40 longer than 2.618 the length of minute wave i. We may not see a Fibonacci ratio for minute wave v, but if we do the most likely would be equality with minute wave i, which would see minute wave v 6.70 in length.

Ratios within minute wave iii are: there is no Fibonacci ratio between minuette waves (iii) and (i), and minuette wave (v) is 0.08 short of 0.382 the length of minuette wave (i).

I have used Elliott’s first channeling technique to draw a parallel channel about this downwards impulse. Draw the first trend line from the lows labeled minute waves i to iii, then place a parallel copy upon the high labeled minute wave ii. I would expect minute wave iv to be likely to find resistance at the upper edge of this channel.

So far minute wave iv has lasted seven days. The structure is incomplete. It may finish in another two to three days.

Minute wave iv may not move into minute wave i price territory. This wave count is invalidated with movement above 105.54.

US Oil Elliott Wave Chart Hourly 2013

Minute wave iii was over already at the time last analysis was prepared. It has managed to just avoid a truncated fifth; minuette wave (v) ends slightly below the end of minuette wave (iii).

Minute wave iv is unfolding as either a flat correction, double combination or double zigzag.

If downwards movement reaches 93.02 or below then this labeling will remain as it is. I would expect minuette wave (b) to most likely end between 100% to 138% of minuette wave (a) at 92.74 to 91.66. The following upwards movement for minuette wave (c) must subdivide as a five wave structure and would be extremely likely to make a new high above 95.57 to avoid a truncation and a very rare running flat.

If downwards movement fails to reach the minimum of 90% of minuette wave (a) at 93.02 then I would relabel this structure W-X-Y and expect a double combination or double zigzag. I would expect a double combination as most likely because the X wave within it is reasonably deep. A combination would expect minuette wave (y) to end about the same point, or very slightly above the end of minuette wave (w) at 95.57 so that the whole structure moves sideways. Minuette wave (y) would most likely unfold as a flat correction.

The least likely possibility for minute wave iv would be a double zigzag because within them X waves are not usually this deep.

The last possibility for minute wave iv would be a triangle. This would expect another two or three days of very choppy, overlapping and sideways movement.

Overall the best guide to when this fourth wave correction is over may be the channel on the daily chart. If upwards movement over the next couple of days reaches the upper edge of the channel then I would expect minute wave iv to be over.

Finally, there is an alternate possibility that minute wave iv was over at 95.57 as a brief zigzag. This would not provide much alternation with minute wave ii, and minute wave iv would have lasted only two days. Only if we see a clear five down on the hourly chart would I consider this outlying possibility.

GOLD Elliott Wave Technical Analysis – 26th November, 2013

Movement above 1,249.06 confirmed the main wave count shortly after publication of yesterday’s analysis. At that stage the analysis expected a little more upwards movement, to be followed by a deep second wave correction. This is exactly what happened.

Continue reading GOLD Elliott Wave Technical Analysis – 26th November, 2013

GOLD Elliott Wave Technical Analysis – 25th November, 2013

Last analysis expected more downwards movement towards a target at 1,207 to 1,198. Price has moved lower, but so far is well short of the target.

I have two hourly wave counts for you today. I will use confirmation / invalidation points to work with these two wave counts today.

Continue reading GOLD Elliott Wave Technical Analysis – 25th November, 2013

GOLD Elliott Wave Technical Analysis – 22nd November, 2013

Last analysis expected a small fourth wave correction to end about 1,246.71 before we saw more downwards movement. The fourth wave correction is most likely now to be complete at 1,249.06. The next wave should unfold early next week.

The wave count remains the same.

Continue reading GOLD Elliott Wave Technical Analysis – 22nd November, 2013

GOLD Elliott Wave Technical Analysis – 21st November, 2013

Yesterday’s analysis expected a third wave downwards to end about 1,234 to 1,236. The third wave has ended at 1,236.89.

The wave count remains the same.

Click on the charts below to enlarge.

Gold Elliott Wave Chart Daily 2013

Gold is still within a large fourth wave correction at primary wave degree which is incomplete. It is now more likely to continue as a double combination because within it intermediate wave (X) should be deep.

The purpose of double combinations is to take up time and move price sideways, so I would now expect intermediate wave (Y) to end about the same level as intermediate wave (W) at 1,433.83. Double combinations in fourth wave positions are quite common.

If downwards movement reaches 1,205.74 or below then it would be 90% of the prior upwards movement labeled intermediate wave (W). At that stage I would relabel primary wave 4 as a flat correction, A-B-C rather than a combination W-X-Y.

Within the combination intermediate wave (X) is unfolding as a zigzag. Minor wave C downwards must complete as a five wave structure. At 1,206 minor wave C would reach equality in length with minor wave A. Within minor wave C at 1,198 minute wave v would reach 1.618 the length of minute wave i. This gives an $8 target zone for downwards movement to end. I will try to narrow this zone as the structure gets closer to the end.

There is no lower invalidation point for intermediate wave (X); X waves may make new price extremes beyond the start of W waves, and they may behave like B waves within flat corrections. For combinations X waves often end close to the start of W waves.

I have drawn a parallel channel about the zigzag of intermediate wave (X) using Elliott’s technique for a correction. Draw the first trend line from the start of minor wave A to the end of minor wave B. Place a parallel copy upon the end of minor wave A. I will expect minor wave C to find support at the lower end of this channel, and it may end there.

Primary wave 4 may not move into primary wave 1 price territory. This wave count is invalidated with movement above 1,532.90.

GOLD Elliott Wave Chart Hourly 2013

There are several ways to label this downwards wave of minute wave v so far. This labeling has the best fit.

On the daily chart it looks like minute wave v may have entered the fourth wave within it, so this fits with the look on the daily chart.

If minuette wave (iii) is over at 1,236.89 then it is 2.45 short of 2.618 the length of minuette wave (i).

Ratios within minuette wave (iii) are: there is no Fibonacci ratio between subminuette waves iii and i, and subminuette wave v is just 0.34 short of 0.618 the length of subminuette wave i.

The strongest downwards movement is the middle of the third wave. This wave count fits perfectly, so far, with MACD.

Draw a parallel channel about minute wave v using Elliott’s first technique. Draw the first trend line from the lows labeled minuette waves (i) to (iii), then place a parallel copy upon the high labeled minuette wave (ii). I will expect minuette wave (iv) to find resistance at the upper edge of this channel.

Minuette wave iv should show alternation with minuette wave (ii). Minuette wave (ii) was a relatively shallow 45% double combination correction. Minuette wave (iv) may show alternation in depth and / or structure. So far it looks like it may be unfolding as a zigzag which would provide alternation in structure. If it finds resistance at the upper edge of the channel it may end about the 0.236 Fibonacci ratio of minuette wave (iii) at 1,246.71, and show some alternation in depth also.

Minuette wave (iv) may not move into minuette wave (i) price territory. This wave count is invalidated with movement above 1,270.14.

GOLD Elliott Wave Technical Analysis – 20th November, 2013

Yesterday’s analysis expected downwards movement with an increase in momentum towards a short term target at 1,251.

So far downwards movement has reached $3.34 below the target and momentum has increased.

Continue reading GOLD Elliott Wave Technical Analysis – 20th November, 2013

US Oil Elliott Wave Technical Analysis – 19th November, 2013

Last analysis of US Oil expected more downwards movement towards a target at 87.82 to 88.72. Price has moved lower and the target has not been yet met, the structure is incomplete.

Now there is more structure of this long downwards wave to analyse I am changing the wave count within it. Two fourth wave triangles indicate it is much closer to the end. The target has been recalculated.

Click on the charts below to enlarge.

US Oil daily 2013

The bigger picture sees US Oil in a new downwards trend to last from one to several years. When I can see a clear five wave structure downwards on the daily chart I will have confidence in a trend change at cycle degree. So far the downwards structure for the first wave at minor degree is incomplete, and I cannot say that there is yet a clear five down.

The labeling within the downwards wave has this week been changed to see the strongest downwards movement as within the third wave. Minute wave iii is extended and not yet complete. Within minute wave iii the middle of the third wave is extended (this is the most common extension).

Within minute wave iii there is no Fibonacci ratio between minuette waves (i) and (iii). This makes it more likely we shall see a Fibonacci ratio between minuette wave (v) and minuette waves (i) or (iii). At 89.83 minuette wave (v) would reach equality with minuette wave (i), and this is the most common ratio so it has the highest probability.

When minute wave iii is completed then I would expect about four days of upwards movement for minute wave iv to end between 92.51 and 94.54 (within the price range of the fourth wave of one lesser degree).

Thereafter, I would expect one relatively short fifth wave down to last about three or four days, and be about 6.70 in length. That would complete the entire structure for minor wave 1.

Minor wave 2 may not move beyond the start of minor wave 1. This wave count is invalidated with movement above 112.24.

US Oil hourly 2013

The two triangle structures indicate that two fourth waves have just completed. This indicates further downwards movement for a fifth wave.

There is classic technical divergence at the end of subminuette wave iii and minuette wave (iii).

For both triangles MACD hovers about the zero line.

Overall I expect about two more weeks of downwards movement to end minor wave 1, with a final fourth wave correction during this time.

GOLD Elliott Wave Technical Analysis – 19th November, 2013

Yesterday’s analysis expected more downwards movement to a short term target at 1,264 to be followed by upwards movement for a second wave correction.

Price did move a little lower but only reached down to 1,269.27. Sideways movement over the last several hours looks typically corrective.

Continue reading GOLD Elliott Wave Technical Analysis – 19th November, 2013