Monthly Archives: June 2015

GOLD Elliott Wave Technical Analysis – 15th June, 2015

Sideways movement in a larger range fits the bear Elliott wave count at the hourly chart level better than the bull.

Continue reading GOLD Elliott Wave Technical Analysis – 15th June, 2015

GOLD Elliott Wave Technical Analysis – 12th June, 2015

A small range for Friday with a small red doji fits the bear Elliott wave count slightly better than the bull.

Continue reading GOLD Elliott Wave Technical Analysis – 12th June, 2015

GDX Elliott Wave Technical Analysis – 10th June, 2015

I have the same two Elliott wave counts for GDX. I still favour neither.

GDX does not appear to have sufficient volume for Elliott wave analysis of this market to be reliable. It exhibits truncations readily, and often its threes look like fives while its fives look like threes. I will let my Gold analysis lead GDX, and I will not let GDX determine my Gold analysis for this reason.

Bull Wave Count

GDX monthly 2014
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The bull wave count expects that a five wave impulse is complete for primary wave A down. Within it, the extended wave is intermediate wave (3). Intermediate wave (3) is 0.11 longer than 2.618 the length of intermediate wave (1), and there is no Fibonacci ratio between intermediate wave (5) and either of (1) or (3).

The channel drawn about primary wave A down is a best fit. The upper edge is still providing resistance. For the bear count (or any variation of it) to be discarded this trend line must be breached. That would provide trend channel confirmation that primary wave A is over and the next wave of primary wave B would then be underway.

Because primary wave A subdivides as a five, primary wave B may not move beyond its start above 64.05.

Primary wave B must subdivide as a corrective structure.

GDX daily 2014
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The wave down labelled intermediate wave (X) is 88% of the prior upwards wave of intermediate wave (W). A flat correction can be ruled out for primary wave B, at this stage, because this is less than 90%. Intermediate wave (W) subdivides well as a zigzag.

Primary wave B may be unfolding as a double zigzag. The first zigzag in the double labelled intermediate wave (W) is complete. The double is joined by a three in the opposite direction, a zigzag labelled intermediate wave (X) which is also now complete. The second zigzag in the double is underway labelled intermediate wave (Y).

The purpose of the second zigzag in a double (and the third in a rare triple) is to deepen the correction when the first (and second) zigzag does not move price deep enough. To achieve this purpose the second (and third) zigzag moves substantially beyond the end of the first (and second). Intermediate wave (Y) may be expected to move substantially above the end of intermediate wave (W) at 23.22.

Within intermediate wave (Y), minor wave A is a complete leading contracting diagonal. Minor wave B is now a complete expanded flat. Within it, minute wave c is 0.04 longer than 1.618 the length of minute wave a.

At 28.12 minor wave C would reach 2.618 the length of minor wave A. This would see intermediate wave (Y) achieve its purpose of deepening the correction for primary wave B.

Bear Wave Count

GDX monthly alternate 2014
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While price continues to find strong resistance at the upper black trend line of this channel, this bear wave count must be considered alongside the bull wave count for GDX.

Minute wave ii may not move beyond the start of minute wave i above 23.22.

At 11.22 intermediate wave (5) would reach equality in length with intermediate wave (1).

GDX daily 2014
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A new low below 17.29 would at this stage invalidate the bull wave count and provide confirmation for this bear wave count.

This bear wave count expects a third wave down to begin to gather momentum. At 12.12 minute wave iii would reach 1.618 the length of minute wave i.

Draw a base channel about minuette waves (i) and (ii). Along the way down, upwards corrections should find resistance at the upper trend line. A clear breach of the upper green line would reduce the probability of this bear wave count.

Technical Analysis

GDX Technical Analysis 2014
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Blue Lines: from the high at 55.25 to the high at 28.03 price moved lower while On Balance Volume moved higher. This negative divergence may indicate a larger fall to come.

Lilac Lines: More recently, as price has made lower highs, OBV has also made lower highs. There is no divergence, so the fall in price is supported by a fall in volume.

Green Lines: Recently price has also made higher lows. Again OBV agrees. There is no divergence.

The green and lilac trend lines on both price and OBV are converging suggesting a breakout is coming closer. With the strong divergence between price and OBV from September 2012 to July 2014 a downwards breakout may be slightly more likely.

GDX Technical Analysis 2014
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ADX is just over 15 and rising. The -DX line (dashed red) is above the +DX line (green) indicating this may be the start of a new downwards trend. If ADX rises to 20 or above a downwards trend would be more clearly indicated.

As price falls OBV also falls. There is no divergence, so this fall in price is supported by OBV.

Price is below the 34 day EMA. The trend may be expected to be more likely down than up at this stage.

GDX Technical Analysis 2014
Click chart to enlarge.

This is my own particular method of trend line analysis.

Each series of parallel lines is coded with a different colour. I use this approach to suggest potential areas of support and resistance.

GOLD Elliott Wave Technical Analysis – 9th June, 2015

There are four hourly Elliott wave counts today.

Confirmation / invalidation points may be used to work with these four Elliott wave counts over the next two days, until we are left eventually with only one count.

Continue reading GOLD Elliott Wave Technical Analysis – 9th June, 2015

GOLD Elliott Wave Technical Analysis – 8th June, 2015

A small inside day fits both Elliott wave counts at the hourly chart level. The Elliott wave counts remain the same.

Continue reading GOLD Elliott Wave Technical Analysis – 8th June, 2015

US OIL Elliott Wave Technical Analysis – 6th June, 2015

Upwards movement was not over and a new high was made. Thereafter, price has again turned down, but is this the end of a trend or just a correction against the trend?

Continue reading US OIL Elliott Wave Technical Analysis – 6th June, 2015

GOLD Elliott Wave Technical Analysis – 5th June, 2015

Downwards movement was expected. The first target at 1,165 was met and exceeded by 2.2.

Summary: It is more likely this downwards wave is incomplete. Confirmation would come with a new low below 1,162.80, with the target at 1,157. Alternatively, it is possible this downwards wave is over now. A new high above 1,179.60 would confirm an end to this downwards movement and the early stage of the next wave up.

To see the bigger picture and weekly charts go here.

Changes to last analysis are italicised.

Bull Wave Count

Gold Elliott Wave Chart Daily 2015
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The bull wave count sees primary wave 5 and so cycle wave a a complete five wave impulse on the weekly chart.

Pros:

1. The size of the upwards move labelled here intermediate wave (A) looks right for a new bull trend at the weekly chart level.

2. The downwards wave labelled intermediate wave (B) looks best as a three.

3. The small breach of the channel about cycle wave a on the weekly chart would be the first indication that cycle wave a is over and cycle wave b has begun.

Cons:

1. Within intermediate wave (3) of primary wave 5 (now off to the left of this chart), to see this as a five wave impulse requires either gross disproportion and lack of alternation between minor waves 2 and 4 or a very rare running flat which does not subdivide well. I have tried to see a solution for this movement, and no matter what variation I try it always has a major problem.

2. Intermediate wave (5) of primary wave 5 (now off to the left of the chart) has a count of seven which means either minor wave 3 or 5 looks like a three on the daily chart.

3. Expanding leading diagonals (of which intermediate wave (A) or (1) is) are are not very common (the contracting variety is more common).

4. The possible leading diagonal for minor wave 1 and particularly minute wave ii within it look too large.

For volume to clearly support the bull wave count it needs to show an increase beyond 187.34 (30th April) and preferably beyond 230.3 (9th April) for an up day. Only then would volume more clearly indicate a bullish breakout is more likely than a bearish breakout.

Within cycle wave b, primary wave A may be either a three or a five wave structure. So far within cycle wave b there is a 5-3 and an incomplete 5 up. This may be intermediate waves (A)-(B)-(C) for a zigzag for primary wave A, or may also be intermediate waves (1)-(2)-(3) for an impulse for primary wave A. At 1,320 intermediate wave (C) would reach equality in length with intermediate wave (A) and primary wave A would most likely be a zigzag. At 1,429 intermediate wave (3) would reach 1.618 the length of intermediate wave (1) and primary wave A would most likely be an incomplete impulse.

Intermediate wave (A) subdivides only as a five. I cannot see a solution where this movement subdivides as a three and meets all Elliott wave rules (with the sole exception of a very rare triple zigzag which does not look right). This means that intermediate wave (B) may not move beyond the start of intermediate wave (A) below 1,131.09. That is why 1,131.09 is final confirmation for the bear wave count at the daily and weekly chart level.

Intermediate wave (C) is likely to subdivide as an impulse to exhibit structural alternation with the leading diagonal of intermediate wave (A). This intermediate wave up may be intermediate wave (3) which may only subdivide as an impulse.

This bull wave count sees minor wave 1 a short brief impulse and minor wave 2 now an expanded flat correction. Within minor wave 2, minute wave c has now moved below the end of minute wave a at 1,178.59 avoiding a truncation and a very rare running flat.

It is possible that minor wave 2 is over here. If it is, then minute wave c is just 2.7 longer than 1.618 the length of minute wave a. At 1,288 minor wave 3 would reach 1.618 the length of minor wave 1. If minor wave 2 moves lower, this target must also move correspondingly lower.

Minor wave 2 may not move beyond the start of minor wave 1 below 1,142.82.

After completion of minor wave 2, then a new high above 1,232.49 would eliminate the bear wave count and provide full confidence in the targets.

Gold Elliott Wave Chart Hourly 2015
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There are two ideas in this analysis for this last wave down of minuette wave (v). Both ideas work in exactly the same way for both bull and bear wave counts.

If this fifth wave is over, then it would be just 2.28 longer than equality with minuette wave (i). Because there is no adequate Fibonacci ratio between minuette waves (i) and (iii), it is very likely that this fifth wave will exhibit a Fibonacci ratio to either the first or third.

I have checked the subdivisions of this fifth wave on the five and one minute charts. Within this impulse, the fourth wave corrections are quicker than the second wave corrections (this is actually typical for Gold when it has strong extended fifth waves) giving some of these waves a three wave look on this hourly chart, when they subdivide as fives on a lower time frame.

The middle of the third wave must subdivide as an impulse, and on the one minute chart it does.

Subminuette wave ii was a combination and subminuette wave iv a zigzag. There is perfect alternation.

There are no adequate Fibonacci ratios between subminuette waves i, iii and v. This reduces the probability of this wave count.

A new high above 1,179.60 is required for first confirmation. At that stage, the next confirmation would come with a clear breach of this best fit channel. Only then would I have full confidence that this impulse for minute wave c is over and the next wave up is underway.

A new low below 1,162.80 would invalidate this idea at the hourly chart level. If that happens then use the hourly bear wave count for this bull wave count. They have would then have exactly the same subdivisions and targets.

Bear Wave Count

Gold Elliott Wave Chart Daily 2015
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This wave count follows the bear weekly count which sees primary wave 5 within cycle wave a as incomplete. At 957 primary wave 5 would reach equality in length with primary wave 1.

Pros:

1. Intermediate wave (1) (to the left of this chart) subdivides perfectly as a five wave impulse with good Fibonacci ratios in price and time. There is perfect alternation and proportion between minor waves 2 and 4. For this piece of movement, the bear wave count has a much better fit than the bull wave count.

2. Intermediate wave (2) is a very common expanded flat correction. This sees minor wave C an ending expanding diagonal which is more common than a leading expanding diagonal.

3. Minor wave B within the expanded flat subdivides perfectly as a zigzag.

4. Volume at the weekly and daily chart continues to favour the bear wave count. Since price entered the sideways movement on 27th March it is a downwards week which has strongest volume, and it is downwards days which have strongest volume.

5. On Balance Volume on the weekly chart recently breached a trend line from back to December 2013. This is another bearish indicator.

Cons:

1. Intermediate wave (2) looks too big on the weekly chart.

2. Intermediate wave (2) has breached the channel from the weekly chart which contains cycle wave a.

3. Minor wave 2 is much longer in duration than a minor degree correction within an intermediate impulse normally is for Gold. Normally a minor degree second wave within a third wave should last only about 20 days maximum. This one is 44 days long.

4. Within minor wave 1 down, there is gross disproportion between minute waves iv and ii: minute wave iv is more than 13 times the duration of minute wave i, giving this downwards wave a three wave look.

Minor waves 1 and 2 are complete. Minute wave i within minor wave 3 may be incomplete on the hourly chart.

Minute wave ii may not move beyond the start of minute wave i above 1,232.49.

The bull and bear wave counts both see a five wave impulse down either incomplete and requiring a final fifth wave, or complete at today’s low.

If this impulse takes price below 1,142.82, then the bull wave count would be invalidated. But only a new low below 1,131.09 would invalidate any variation of a bull wave count and provide full and final confirmation for a bear wave count.

When this five wave impulse is complete, then the bull wave count will expect a third wave up and this bear wave count will expect a second wave correction. At that stage, the bear wave count would be invalidated with a new high above 1,232.49 and the bull wave count would be confirmed.

Gold Elliott Wave Chart Hourly 2015
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Both hourly wave counts work the same way for bull and bear.

This idea expects a final fifth wave down to unfold. At 1,157 minuette wave (v) would be extended and would reach equality in length with minuette wave (i).

There is no Fibonacci ratio between subminuette waves i and iii. It would be very likely that subminuette wave v will exhibit a Fibonacci ratio to either of i or iii, and equality with i at 12.11 in length would be the most likely ratio.

Subminuette wave ii was a quick zigzag. Subminuette wave iv may be a more long lasting flat, combination or triangle. Within it, the B wave is most likely incomplete, may move lower, and may even make a new low below 1,162.80 as in an expanded flat or running triangle. If that happens as part of this fourth wave, then this wave count would be confirmed and the idea presented for the bull wave count which sees this movement over would be invalidated.

This idea expects choppy overlapping movement for a few hours yet before this fourth wave is over. It would then be followed by a swift strong fifth wave down to the target. Please note: the arrow here depicts an expanded flat only because they are very common structures, but subminuette wave iv may be a triangle and may unfold sideways in a much narrower range than the arrow depicts.

Subminuette wave iv is most likely to end within the price territory of the fourth wave of one lesser degree. Micro wave 4’s territory is from 1,174.75 to 1,176.74.

At any stage, a new low below 1,162.80 would confirm this idea. Both bull and bear wave counts would then have the same target for the next wave down to end at 1,157.

Technical Analysis

Gold Chart Daily 2015
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There is now a full daily candlestick below the lower aqua blue line which began back on 31st March. This may still only be an overshoot. Price has not closed 3% or more of market value below this line and so a bearish breakout is not yet indicated. (3% of market value below 1,178.59 is at 1,143.23) At this stage, it should actually be expected that this downwards swing will end either here or very soon and will be followed by another upwards swing towards resistance.

Stochastics remains oversold. This downwards swing should end soon.

ADX remains flat and below 15 indicating no clear trend still. It is possible that Friday’s data could bring ADX up to 15, and if that happens, then a downwards trend would be indicated. For now only Thursday’s data is available for ADX.

The slight decrease in volume for Friday is a slight concern. It looks like the market is falling of its own weight.

The long lower wick on the candlestick for Friday is a slight bullish indicator.

This analysis is published about 05:00 p.m. EST.

GOLD Elliott Wave Technical Analysis – 4th June, 2015

Yesterday’s analysis was unclear as to what direction to expect with three different Elliott wave counts with different expectations. A new low below 1,178.08 eliminated one Elliott wave count, now leaving only two which expect the same direction next.

Continue reading GOLD Elliott Wave Technical Analysis – 4th June, 2015

GOLD Elliott Wave Technical Analysis – 3rd June, 2015

Upwards movement was expected for the bull and main bear Elliott wave counts, but downwards movement breached their invalidation points. The alternate bear Elliott wave count is now taken more seriously.

Continue reading GOLD Elliott Wave Technical Analysis – 3rd June, 2015

GOLD Elliott Wave Technical Analysis – 1st June, 2015

Upwards movement was expected and is enough to provide full confirmation of the two main Elliott wave counts, which still do not diverge at this stage.

Continue reading GOLD Elliott Wave Technical Analysis – 1st June, 2015