Downwards movement was expected for Friday’s session.
Price moved overall lower in a small inside day.
Upwards movement has now breached the final bear market trend line.
With confirmation of a trend change, the main wave count should now be bullish.
Downwards movement has breached the invalidation point on the main Elliott wave count, but this was allowed for in the alternate.
Overall, a correction against a trend was expected to be continuing.
This is the last analysis prior to the Christmas / New Year break.
Next analysis will be done after market close for Monday, 4th January, 2016.
May you all have a very Merry Christmas and a Happy New Year!
Downwards movement was not expected below 1,132.12.
Only one bull wave count remains valid as does the bear.
Both Elliott wave counts expected more downwards movement for Friday, which is what happened.
Now is when the bull and bear wave counts diverge, and next week price may provide clarity.
This Elliott wave count expects Gold is within a grand super cycle correction.
Downwards movement for Wednesday was expected, but this is not what happened. While upwards movement remains below the invalidation point it makes the situation unclear. I will present four Elliott wave counts, 2 bull and 2 bear.
Upwards movement was expected.
Downwards movement continued as expected from last Elliott wave analysis. I have a new alternate wave count for you which differs at the weekly and daily chart level.
Movement below 1,273.03 has invalidated the main Elliott wave count and confirmed the alternate. The situation is now clear. Elliott wave analysis will now focus on targets for this new trend.
Sideways movement continued, although for less than one day. The breakout was expected to be upwards. The alternate hourly wave count target for sideways movement to end was at 1,311.44 which was met and exceeded by just 1.01.
Summary: Minor wave B is complete as a triangle. Minor wave C may be brief and is extremely likely to fall short of the (A)-(C) trend line on the daily chart. The target for it to end is at 1,343 in one or two days.
Click on charts to enlarge.
It is time to take a quick look at the bigger picture with primary wave 4 now so close to its end.
This wave count sees a clear five wave structure (that is how it subdivides on the daily chart) for primary wave 1. Any wave count which sees the end of primary wave 1 anywhere else than at that point must clearly explain how it is a five and not a three.
Primary wave 2 was a rare running flat which lasted 53 weeks. Primary wave 4 is a regular contracting triangle which has so far lasted also 53 weeks. If primary wave 4 ends soon it will be perfectly in proportion to primary wave 2 giving this wave count the right look.
Primary wave 3 is 12.54 short of 1.618 the length of primary wave 1.
The channel drawn here uses Elliott’s first technique: draw the first trend line from the ends of primary waves 1 to 3, then place a parallel copy upon the end of primary wave 2. If primary wave 4 overshoots the (A)-(C) trend line of its triangle then it may find resistance at the upper edge of this channel.
When primary wave 4 is done then primary wave 5 downwards should follow. It would most likely be equal in length with primary wave 1 at 388.25.
Primary wave 4 is very close to completion.
Intermediate wave (E) is most likely to fall short of the (A)-(C) trend line. It may also overshoot this trend line, but that is less common. If it does overshoot this trend line then it may find resistance, and end, at the upper edge of the bigger maroon channel on the weekly chart.
Within the zigzag of intermediate wave (E) minor wave B is now complete as a small triangle and minor wave C has begun. At 1,343 minor wave C would reach 0.382 the length of minor wave A and intermediate wave (E) would end before the (A)-(C) trend line.
When there is more structure within minor wave C to analyse I will be able to calculate a target for it to end at minute degree. The target at 1,343 may widen to a small zone or change.
So far within primary wave 4 intermediate wave (A) lasted 43 days (no Fibonacci relationship), intermediate wave (B) lasted 88 days (just one day short of a Fibonacci 89), intermediate wave (C) lasted 53 days (just two days short of a Fibonacci 55) and intermediate wave (D) lasted 56 days (just one day more than a Fibonacci 55). So far intermediate wave (E) has lasted 19 days and is almost complete. It may complete in a total Fibonacci 21 days (give or take one day either side of this).
Minor wave B is another perfect contracting triangle with minute wave e falling short of its a-c trend line.
Triangles precede the final movement one degree higher. Minor wave C is the final wave up to complete this entire structure at primary wave degree.
Waves following triangles are usually shorter than the wave which precedes the triangle. I would expect minor wave C to be shorter than minor wave A while also considering the (A)-(C) trend line on the daily chart.
So far within minor wave C there is an almost complete five wave impulse. Minuette wave (iv) may not move into minuette wave (i) price territory below 1,319.27.
When minute wave i upwards is a complete five wave structure then I would expect downwards movement for minute wave ii which may not move beyond the start of minute wave i at 1,310.43. At that stage it would also be entirely possible that minor wave C and so primary wave 4 are complete. At that stage movement below 1,310.43 would indicate that primary wave 5 has begun.
My only concern with this wave count today is what degree of labeling to use on minor wave C upwards. Is this just minute wave i or is minor wave C going to be particularly brief and is it almost over now? The depth of the next wave downwards will answer that question tomorrow.
This analysis is published about 04:55 p.m. EST.