Category Archives: Public Analysis

GOLD Elliott Wave Technical Analysis – 12th January, 2018

An upwards breakout from a consolidation was expected, but it has come much more quickly than expected. A new alternate wave count this week should prepare members if price continues higher from here.

Summary: The main wave count expects a trend change to a new bear market to last one to several years, and the target is 463. However, for confidence in this view, first a new low below 1,324.93 and then a breach of the Elliott channel on the hourly charts by downwards movement is required.

A new alternate expects overall upwards movement from here. It would be confirmed if price makes a new high reasonably above 1,357.09.

[Content protected for Elliott Wave Gold members only. To subscribe click here.] Always manage risk by trading with stops and investing only 1-5% of equity on any one trade.

New updates to this analysis are in bold.

Last monthly charts for the main wave count are here, another monthly alternate is here, and video is here.

Grand SuperCycle analysis is here.

MAIN ELLIOTT WAVE COUNT

WEEKLY CHART

Gold Elliott Wave Chart Weekly 2018
Click chart to enlarge.

All wave counts expect that Gold completed a large five down from the all time high in November 2011 to the low of December 2015, which is seen on the left hand side of both weekly charts.

If this analysis is correct, then the five down may not be the completion of the correction. Corrective waves do not subdivide as fives; they subdivide as threes. The five down is seen as cycle wave a within Super Cycle wave (a).

All wave counts then expect cycle wave b began in December 2015.

There are more than 23 possible corrective structures that B waves may take. It is important to always have multiple wave counts when B waves are expected. It is for this reason that a weekly alternate wave count will be published daily.

It looks unlikely that cycle wave b may have been over at the high labelled primary wave A. Primary wave A lasted less than one year at only 31 weeks. Cycle waves should last one to several years and B waves tend to be more time consuming than other Elliott waves, so this movement would be too brief for cycle wave b.

This wave count looks at cycle wave b to be most likely a regular contracting triangle.

All sub-waves must subdivide as threes within an Elliott wave triangle, and four of the five sub-waves must be zigzags or multiple zigzags, and the most common sub-wave to be a multiple is wave C. Only one sub-wave may be a more complicated multiple. This triangle meets all these rules and guidelines; all subdivisions fit perfectly at all time frames. It is the main wave count for these reasons, and thus is judged to have the highest probability.

The triangle trend lines have a normal looking convergence. Primary wave D now looks fairly likely to be complete, and it looks like an obvious three wave structure at the weekly chart level.

While primary wave E should also most likely look like an obvious three wave structure at the weekly and daily chart levels, it does not have to do this. It is possible at the end of this week that primary wave E could be over, falling reasonably short of the A-C trend line and being relatively quick. E waves of triangles can often be the quickest of all triangle waves.

DAILY CHART

Gold Elliott Wave Chart Daily 2018
Click chart to enlarge.

This first wave count follows on directly from the weekly chart above. It looks at primary wave E as a single zigzag. Zigzags subdivide 5-3-5.

It is possible today that the zigzag for primary wave E may be complete. It looks like a zigzag at the daily chart level. E waves of triangles can be surprisingly quick. A very good example of this is here on this daily chart: the triangle labelled intermediate wave (B) within primary wave D also came to a quicker than expected end.

The target calculated for cycle wave c assumes the most common Fibonacci ratio to cycle wave a.

If primary wave E continues higher, it may not move beyond the end of primary wave C above 1,357.09. A new high by any amount at any time frame would immediately invalidate this wave count.

2 HOURLY CHART

Gold Elliott Wave Chart Hourly 2018
Click chart to enlarge.

This 2 hourly chart shows all of primary wave E. The bottom line for this wave count is that while price remains within this channel there is no evidence of a trend change. This channel must be breached by downwards movement before any confidence may be had in a trend change.

HOURLY CHART

Gold Elliott Wave Chart Hourly 2018
Click chart to enlarge.

Intermediate wave (B) may have been remarkably brief, much more so than expected. Intermediate wave (C) will now fit as a completed five wave impulse.

A new low below 1,324.93 would add a little confidence in this wave count. A clear breach of the black Elliott channel by downwards movement is required for reasonable confidence.

While price remains within the channel, accept the possibility that it may continue higher.

ALTERNATE HOURLY CHART

Gold Elliott Wave Chart Hourly 2018
Click chart to enlarge.

By simply moving the degree of labelling within the last wave up all down one degree, it is entirely possible that primary wave E is not yet over.

Within minor wave 5, the correction for minute wave ii may not move beyond the start of minute wave i below 1,324.93.

The upper edge of the Elliott channel may provide resistance. If price comes up to touch that trend line and this wave count remains valid, then look out for a downwards reaction there.

ALTERNATE ELLIOTT WAVE COUNT

WEEKLY CHART

Gold Elliott Wave Chart Weekly 2018
Click chart to enlarge.

This is the best bullish wave count that I can see at this stage. The extra video for members this week shows how it was developed.

If cycle wave b is a single zigzag, then the upwards wave labelled here primary wave A must be seen as a five wave structure. But this is problematic because (within primary wave A) intermediate wave (4) lasted 12 weeks whereas intermediate wave (2) only lasted 2 weeks. While disproportion between corrective waves does not violate any Elliott wave rules, it does give a wave count the wrong look.

Gold is typical of commodities in that it often exhibits swift strong fifth waves, leading to blowoff tops in bull markets and selling climaxes in bear markets. This tendency is most often seen in Gold’s third waves. When this happens the strong fifth wave forces the fourth wave correction that comes before it to be more brief and shallow than good proportion to its counterpart second wave would suggest. When this happens the impulse has a curved three wave look to it at higher time frames.

It is acceptable for a wave count for a commodity to see a curved impulse which has a more time consuming second wave correction within it than the fourth wave correction.

The impulse has a more time consuming fourth wave than the second in this case though, giving the wave the look of a zigzag. This is unusual, and so the probability of this wave count is low.

Low probability does not mean no probability, so this wave count is possible; when low probability outcomes do occur, they are never what was expected as most likely.

Primary wave C must subdivide as a five wave structure, either an impulse or an ending diagonal. Because the upwards wave of intermediate wave (1) fits as a zigzag and will not fit as an impulse, an ending diagonal is considered.

Ending diagonals require all sub-waves to subdivide as zigzags.

Within intermediate wave (1), to see this wave as a zigzag, minor wave B is seen as a double flat correction. In my experience double flats are extremely rare structures, even rarer than running flats. The rarity of this structure further reduces the probability of this wave count.

Intermediate wave (3) must move beyond the end of intermediate wave (1) above 1,357.09.

SECOND ALTERNATE ELLIOTT WAVE COUNT

WEEKLY CHART

Gold Elliott Wave Chart Weekly 2018
Click chart to enlarge.

This second alternate is new, developed from a suggestion by an Elliott Wave Gold member, Dreamer.

A triangle may be completing as an X wave within a double zigzag for cycle wave b.

Now the upwards wave labelled here primary wave W is seen as a zigzag. This has a better fit than the first alternate.

Within the triangle for primary wave X, intermediate waves (A) through to (C) may be complete. Intermediate wave (D) may also be complete, but there is room for it to still move higher. If the triangle for primary wave X is a regular contracting triangle, then intermediate wave (D) may not move beyond the end of intermediate wave (B) above 1,357.09. If the triangle is a barrier triangle, then intermediate wave (D) should end about the same level as intermediate wave (B), so that the (B)-(D) trend line remains essentially flat. In practice, this means that intermediate wave (D) may end slightly above 1,357.09 and this wave count would remain valid.

This is why a new high reasonably above 1,357.09 only would invalidate this wave count. This invalidation point is not black and white.

TECHNICAL ANALYSIS

WEEKLY CHART

Gold Weekly 2018
Click chart to enlarge. Chart courtesy of StockCharts.com.

Now that price has again broken above resistance at 1,305 to 1,310, that area may now provide support. Next resistance is about 1,345.

Stochastics is added this week. Price is range bound in a weekly level consolidation. As price swings from resistance to support and back again, Stochastics may be used to assist to see where each swing may end and the next begin. Price is nearing resistance at 1,345 and Stochastics is just entering overbought. It looks reasonable to expect the upwards swing to end soon; there is a little room for price to rise still.

DAILY CHART

Gold Daily 2018
Click chart to enlarge. Chart courtesy of StockCharts.com.

Resistance about 1,330 did not hold during Friday’s session. Next resistance is on the weekly chart about 1,345.

Divergence with RSI has simply disappeared. RSI is overbought, but it can remain so for a reasonable length of time when Gold has a strong bull trend.

Stochastics is overbought and exhibits clear divergence with price, but this can develop further into multiple divergence before the bull trend ends.

ADX indicates the trend is extreme, but this can persist for reasonable periods of time when Gold has a strong bull trend.

There is room still for price to rise further.

GDX DAILY CHART

Gold Daily 2018
Click chart to enlarge. Chart courtesy of StockCharts.com.

Price has broken above resistance with support from volume. Next resistance is about 23.70.

However, for GDX there is weakness exhibited by divergence in both RSI and Stochastics. This may yet disappear, but for now it exists.

The bullish signal given by On Balance Volume is weak because the trend line breached on Friday is short held, reasonably sloped and tested only twice before.

Published @ 05:57 p.m. EST on 13th January, 2018.

[Note: Analysis is public today for promotional purposes. Specific trading advice and comments will remain private for members only.]

Continue reading GOLD Elliott Wave Technical Analysis – 12th January, 2018

GOLD Elliott Wave Technical Analysis – 19th December, 2017

Price has been behaving exactly as expected now for over a week. We may have reasonable confidence in the current Elliott wave count. Volume analysis also supports it today.

Summary: Upwards movement may end tomorrow at 1,268 to 1,270. Thereafter, a third wave down may begin.

Always trade with stops and invest only 1-5% of equity on any one trade.

New updates to this analysis are in bold.

Last monthly charts for the main wave count are here, another monthly alternate is here, and video is here.

Grand SuperCycle analysis is here.

MAIN ELLIOTT WAVE COUNT

WEEKLY CHART

Gold Elliott Wave Chart Weekly I 2017
Click chart to enlarge.

All wave counts expect that Gold completed a large five down from the all time high in November 2011 to the low of December 2015, which is seen on the left hand side of both weekly charts.

If this analysis is correct, then the five down may not be the completion of the correction. Corrective waves do not subdivide as fives; they subdivide as threes. The five down is seen as cycle wave a within Super Cycle wave (a).

All wave counts then expect cycle wave b began in December 2015.

There are more than 23 possible corrective structures that B waves may take. It is important to always have multiple wave counts when B waves are expected.

It looks unlikely that cycle wave b may have been over at the high labelled primary wave A. Primary wave A lasted less than one year at only 31 weeks. Cycle waves should last one to several years and B waves tend to be more time consuming than other Elliott waves, so this movement would be too brief for cycle wave b.

This wave count looks at cycle wave b to be most likely a regular contracting triangle.

The B-D trend line should have a reasonable slope for this triangle to have the right look, because the A-C trend line does not have a strong slope. A barrier triangle has a B-D trend line that is essentially flat; if that happened here, then the triangle trend lines would not converge with a normal look and that looks unlikely.

Primary wave D should be a single zigzag. Only one triangle sub-wave may be a more complicated multiple, and here primary wave C has completed as a double zigzag; this is the most common triangle sub-wave to subdivide as a multiple.

Primary wave D of a contracting triangle may not move beyond the end of primary wave B below 1,123.08.

At its completion, primary wave D should be an obvious three wave structure at the weekly chart level.

For this one weekly chart, two daily charts are presented below. They look at intermediate wave (B) in two different ways, and are presented now in order of probability.

DAILY CHART

Gold Elliott Wave Chart Daily 2017
Click chart to enlarge.

Both daily charts are identical up to the low labelled intermediate wave (A).

This first daily chart shows intermediate wave (B) as a now complete regular contracting Elliott wave triangle. This has support from what looks like a classic downwards breakout from the symmetrical triangle identified on the technical analysis chart below.

The target assumes that intermediate wave (C) may exhibit the most common Fibonacci ratio to intermediate wave (A).

Intermediate wave (C) must subdivide as a five wave structure. Within intermediate wave (C), minor wave 1 may now be complete.

Minor wave 2 so far has lasted five days while minor wave 1 lasted seven days. Minor wave 2 may be over here and exhibit a Fibonacci duration of five, or it may continue a little further and be closer in proportion to minor wave 1 and not exhibit a Fibonacci duration.

Intermediate wave (A) lasted twenty sessions. Intermediate wave (C) may be about even in duration as well as length, so twenty or twenty-one sessions looks likely. The next Fibonacci ratio in the sequence would be thirty-four, and it is possible intermediate wave (C) could be this long lasting.

At its end, minor wave 2 may present an opportunity to join the downwards trend in time to catch a third wave down.

HOURLY CHART

Gold Elliott Wave Chart Hourly 2017
Click chart to enlarge.

At this stage, only one hourly chart will be presented. Yesterday’s alternate no longer has the right look.

Minor wave 2 so far fits best as a double zigzag structure. These are very common. The second zigzag exists to deepen the correction when the first zigzag does not move price deep enough, and sometimes also when it does not last long enough. Minute wave w ending at only 0.49 of minor wave 1 and lasting only three days fits this description.

Minute wave y is deepening the correction and taking up more time.

The best fit channel as drawn in last analysis is no longer useful because price broke below the lower edge but only with sideways movement, so it was not a clear downwards break. The channel is redrawn.

When this channel is clearly breached by downwards (not sideways) movement, then it shall provide an indication that minor wave 2 may be over and minor wave 3 may have begun. When the start of minor wave 3 is known, then a target may be calculated for it to end, but that cannot be done yet.

Minor wave 2 may not move beyond the start of minor wave 1 above 1,287.61.

SECOND DAILY CHART

Gold Elliott Wave Chart Daily 2017
Click chart to enlarge.

It is very important to always consider an alternate when a triangle may be unfolding. Triangles are very tricky structures, and may even be invalidated after one thinks they are complete.

It is still possible that intermediate wave (B) may be completing as a flat correction.

Within the flat correction, both minor waves A and B are threes. Minor wave B has retraced more than the minimum 0.9 length of minor wave A.

With minor wave B now a 1.54 length to minor wave A, an expanded flat is now indicated. Minor wave C of an expanded flat would most commonly be about 1.618 the length of minor wave A.

Now minor wave C may be required to move price upwards to end at least above the end of minor wave A at 1,305.72 to avoid a truncation.

A new high above 1,298.70 is required now for confidence in this wave count. If the upwards wave does not reach up to 1,298.70, then this second wave count will be discarded.

There should be something wrong or “off” about B waves. In this instance, the last downwards wave has some strength. While the market fell of its own weight, On Balance Volume gave bearish signals. Classic technical analysis does not support this wave count, so it looks unlikely now.

ALTERNATE ELLIOTT WAVE COUNT

WEEKLY CHART

Gold Elliott Wave Chart Weekly I 2017
Click chart to enlarge.

All wave counts are identical to the low labelled cycle wave a. Thereafter, they look at different possible structures for cycle wave b.

Cycle wave b may be a flat correction. Within a flat primary, wave B must retrace a minimum 0.9 length of primary wave A at 1,079.13 or below.

TECHNICAL ANALYSIS

WEEKLY CHART

Gold Weekly 2017
Click chart to enlarge. Chart courtesy of StockCharts.com.

The market is falling of its own weight. Next support is about 1,225.

The small real body of the last weekly candlestick puts the trend from down to neutral.

The support line for On Balance Volume is redrawn. A bounce up this week may be bullish.

DAILY CHART

Gold Daily 2016
Click chart to enlarge. Chart courtesy of StockCharts.com.

While markets may fall of their own weight for considerable distances, rising price on declining volume is more of a concern. Price needs support from increasing activity of buyers for it to rise sustainably. So far, for the last four sessions, Gold price is rising on declining volume. This looks more likely to be a counter trend movement than the start of a new sustainable trend.

This view is reinforced with ATR now also declining as price rises. This upwards movement looks weak.

Coming after the symmetrical triangle and a downwards breakout, which had some strength, it looks like this movement is a bounce within a continuing larger downwards trend.

A throwback to the lower edge of the symmetrical triangle is unlikely, that happens only 37% of the time. And so we should expect this bounce to end very soon before it gets that high.

GDX DAILY CHART

Gold Daily 2016
Click chart to enlarge. Chart courtesy of StockCharts.com.

The small real bodies of the last two daily candlesticks puts the trend for the short term from up to neutral.

Volume, ATR and Bollinger Bands all point to this upwards movement more likely being a counter trend movement than the start of a new sustainable upwards trend. That view could change if price starts to move strongly higher, but this is what the data in hand indicates today.

TRADING ADVICE

[Content protected for Elliott Wave Gold members only. To subscribe click here.]

Published @ 06:55 p.m. EST.

[Note: Analysis is public today for promotional purposes. Specific trading advice and comments will remain private for members only.]

Continue reading GOLD Elliott Wave Technical Analysis – 19th December, 2017

GOLD Elliott Wave Technical Analysis – 6th December, 2017

Last analysis advised members to hold onto short positions which should have been entered just prior to or at the downwards breakout. Targets are given today using a classic symmetrical triangle pattern and Elliott wave counts.

Summary: The classic analysis target is about 1,228. The Elliott wave target is at 1,191. The Elliott wave target may be met in about four weeks time.

I will leave it up to members to decide on when to take profits, as each trader may have a different preferred time frame for trading. For maximum profits, positions entered prior to the breakout may possibly be held until the target is reached.

The trend for now may be down. Bounces are opportunities to enter the trend.

Always trade with stops and invest only 1-5% of equity on any one trade.

New updates to this analysis are in bold.

Last monthly charts for the main wave count are here, another monthly alternate is here, and video is here.

Grand SuperCycle analysis is here.

MAIN ELLIOTT WAVE COUNT

WEEKLY CHART

Gold Elliott Wave Chart Weekly I 2017
Click chart to enlarge.

Both wave counts expect that Gold completed a large five down from the all time high in November 2011 to the low of December 2015, which is seen on the left hand side of both weekly charts.

If this analysis is correct, then the five down may not be the completion of the correction. Corrective waves do not subdivide as fives; they subdivide as threes. The five down is seen as cycle wave a within Super Cycle wave (a).

Both wave counts then expect cycle wave b began in December 2015.

There are more than 23 possible corrective structures that B waves may take. It is important to always have multiple wave counts when B waves are expected.

It looks unlikely that cycle wave b may have been over at the high labelled primary wave A. Primary wave A lasted less than one year at only 31 weeks. Cycle waves should last one to several years and B waves tend to be more time consuming than other Elliott waves, so this movement would be too brief for cycle wave b.

This wave count looks at cycle wave b to be most likely a regular contracting triangle.

The B-D trend line should have a reasonable slope for this triangle to have the right look, because the A-C trend line does not have a strong slope. A barrier triangle has a B-D trend line that is essentially flat; if that happened here, then the triangle trend lines would not converge with a normal look and that looks unlikely.

Primary wave D should be a single zigzag. Only one triangle sub-wave may be a more complicated multiple, and here primary wave C has completed as a double zigzag; this is the most common triangle sub-wave to subdivide as a multiple.

Primary wave D of a contracting triangle may not move beyond the end of primary wave B below 1,123.08.

At its completion, primary wave D should be an obvious three wave structure at the weekly chart level.

For this one weekly chart, two daily charts are presented below. They look at intermediate wave (B) in two different ways, and are presented now in order of probability.

DAILY CHART

Gold Elliott Wave Chart Daily 2017
Click chart to enlarge.

Both daily charts are identical up to the low labelled intermediate wave (A).

This first daily chart shows intermediate wave (B) as a now complete regular contracting Elliott wave triangle. This has support from what looks like a classic downwards breakout from the symmetrical triangle identified on the technical analysis chart below.

The target assumes that intermediate wave (C) may exhibit the most common Fibonacci ratio to intermediate wave (A).

Intermediate wave (C) must subdivide as a five wave structure. Within intermediate wave (C), the second wave correction to come may not move beyond the start of the first wave above 1,287.61.

Intermediate wave (A) lasted twenty sessions. Intermediate wave (C) may be about even in duration as well as length, so twenty or twenty-one sessions looks likely.

HOURLY CHART

Gold Elliott Wave Chart Hourly 2017
Click chart to enlarge.

If a new trend at intermediate degree is beginning, then a five down should develop at the daily chart level. That would so far be incomplete and will be labelled here minor wave 1.

Within minor wave 1, minute wave iii may now be a complete impulse that exhibits a ratio of equality with minute wave i and its middle shows an increase in momentum.

Minute wave ii was a shallow zigzag. To exhibit alternation minute wave iv may be a more shallow sideways flat, combination or triangle; it may not be deep because it may not move into minute wave i price territory above 1,272.05.

When minute wave iv is complete, then minute wave v downwards may unfold to new lows. A target for minute wave v cannot be calculated until minute wave iv is complete and the start of minute wave v is known.

The channel is drawn using Elliott’s first technique. Minute wave iv may find resistance at the upper edge. If it does not, then the channel must be redrawn using Elliott’s second technique.

Minute wave v may end about the lower edge of the channel.

SECOND DAILY CHART

Gold Elliott Wave Chart Daily 2017
Click chart to enlarge.

It is very important to always consider an alternate when a triangle may be unfolding. Triangles are very tricky structures, and may even be invalidated after one thinks they are complete.

It is still possible that intermediate wave (B) may be completing as a flat correction.

Within the flat correction, both minor waves A and B are threes. Minor wave B has retraced more than the minimum 0.9 length of minor wave A.

With minor wave B now a 1.01 length to minor wave A, a regular flat is still indicated. Minor wave C of a regular flat would most commonly be about even in length with minor wave A.

If minor wave B continues lower, then an expanded flat would be indicated once it reaches 1.05 the length of minor wave A or below. At that stage, minor wave C would then most likely be about 1.618 the length of minor wave A.

Now minor wave C may be required to move price upwards to end at least above the end of minor wave A at 1,305.72 to avoid a truncation.

A new high above 1,298.70 is required now for confidence in this wave count.

ALTERNATE ELLIOTT WAVE COUNT

WEEKLY CHART

Gold Elliott Wave Chart Weekly I 2017
Click chart to enlarge.

Both wave counts are identical to the low labelled cycle wave a. Thereafter, they look at different possible structures for cycle wave b.

Cycle wave b may be a flat correction. Within a flat primary, wave B must retrace a minimum 0.9 length of primary wave A at 1,079.13 or below.

TECHNICAL ANALYSIS

WEEKLY CHART

Gold Weekly 2017
Click chart to enlarge. Chart courtesy of StockCharts.com.

On Balance Volume is still constrained. The last signal given was bearish.

DAILY CHART

Gold Daily 2016
Click chart to enlarge. Chart courtesy of StockCharts.com.

Downwards movement looks very much like a downwards breakout from a symmetrical triangle. Because the support line for the triangle was tested seven times prior to this breakout, that trend line has strong technical significance and a strong downwards day closing well below it is a strong bearish signal. The breakout had some support from volume. Price today fell of its own weight. While an increase in volume for falling price is good to see, decreasing volume for falling price does not necessarily mean price should turn. It can continue to fall of its own weight, particularly early on in a trend.

Regarding triangles from Kirkpatrick and Dhalquist:

“Throwbacks… occur 37%… of the time, respectively, and, as in most patterns, when they occur, they detract from eventual performance. This implies that for actual investement or trading, the initial breakout should be aced upon, and if a pullback or throwback occurs, the protective stop should be tightened. It does not imply that a pullback or throwback should be ignored, but that instead, performance expectations should be less than if no pullback or throwback had occurred.”

On trading triangles:

“The ideal situation for trading triangles is a definite breakout, a high trading range within the triangle, an upward-sloping volume trend during the formation of the triangle, and especially a gap on the breakout… An initial target for these patterns is calculated by adding the be distance – the vertical distance between the initial upper and lower reversal point prices – to the price where the breakout occurred.”

A target is calculated using this method today to be about 1,228.

Members are warned that a throwback to the lower trend line of the triangle is unlikely. The breakout should have been acted upon within the last 24 hours.

Always remember to manage risk as the most important aspect of trading. Always use a stop and invest only 1-5% of equity on any one trade.

GDX DAILY CHART

Gold Daily 2016
Click chart to enlarge. Chart courtesy of StockCharts.com.

A descending triangle looks to be complete now for GDX. From Kirkpatrick and Dhalquist regarding descending triangles:

“The breakout is more common to the downside (65%), but the upward breakout is more reliable and profitable… This formation can be stretched high and wide and is sometimes difficult to recognise. The trend lines defining its boundaries are almost never exact and are loaded with false intra-bar breakouts. A strict breakout strategy is required… However, prices often explode out of it and produce sizeable gains. It can also be wild and guarantee an exciting ride. It will break out and run, break out and pull back to its trend line, break out and pull back to its cradle, or break back through the cradle, create a sizeable trap, and then reverse back in its original breakout direction and run. In other words, when you enter on a breakout from a descending triangle, the subsequent action must be watched carefully.”

Yesterday looks like a downwards breakout from this triangle, with some support from volume and a small gap down. This breakout should have been acted upon if members did not already hold short positions.

A target calculated from the width of the triangle and applied to the breakout point is at 20.43.

For the short term, with again bearish volume, bearish On Balance Volume, and bearish ADX, another downwards day looks likely tomorrow.

However, price is at support and there is some bullish divergence with Stochastics. I would not give much weight to this divergence though, because it is not replicated with RSI. Divergence with Stochastics tends to be less reliable, because it may just disappear. I would give more weight here to On Balance Volume.

Published @ 07:18 p.m. EST.

[Note: Analysis is public today for promotional purposes. Specific trading advice and comments will remain private for members only.]

Continue reading GOLD Elliott Wave Technical Analysis – 6th December, 2017

Amazon Trend Lines | 21st November, 2017

Unlike Google, Amazon does not have a neat a trend line.

AMZN 2017
Click chart to enlarge.

The solid yellow trend line is Amazon’s equivalent to the Google Forever trend line. The bottom line is that we should assume that Amazon remains in a bull market while price remains above this trend line.

The more recent red channel is an attempt to show where price is more recently finding support and may find resistance.

Note that during this bull market volume has shown a fairly steady decline, at least since January 2009 and probably before that. A bull market which is rising on light and declining volume is unsustainable, theoretically. The fact though is that Amazon has been rising on declining volume for years now.

This decline in volume may indicate that eventually when a high is found the next bear market may be very fast indeed. There would be very little support below to halt a fall in price because volume is so light.

Published @ 01:03 p.m. EST.

SILVER Elliott Wave Technical Analysis – 16th November, 2017

Price was expected to move higher, but sideways movement suggests a triangle is forming for the short term.

Two Elliott wave triangle counts are considered, and the classic symmetrical triangle is examined in this analysis.

Summary: A triangle may be either complete or complete very soon. Watch for the breakout; it may come within a few days. Some trading guidance for triangles is given from Dhalquist and Kirkpatrick in the classic technical analysis section.

New updates to this analysis are in bold.

Last monthly chart is here.

ELLIOTT WAVE COUNTS

FIRST WAVE COUNT

WEEKLY CHART

Silver weekly 2017
Click chart to enlarge.

Cycle wave b may be completing as a double combination: zigzag – X – flat. The second structure, a flat correction for primary wave Y, may be underway.

Within a flat correction, intermediate wave (B) must retrace a minimum 0.9 length of intermediate wave (A) at 15.938. Intermediate wave (B) has met this minimum requirement; the rule for a flat correction is met. Intermediate wave (B) is longer than 1.05 times the length of intermediate wave (A) indicating this may be an expanded flat. Expanded flat corrections are the most common type. Normally their C waves are 1.618 or 2.618 the length of their A waves.

The target calculated would see primary wave Y to end close to same level as primary wave W about 21.062. The purpose of combinations is to take up time and move price sideways. To achieve this purpose the second structure in the double normally ends about the same level as the first.

While the combination wave count at the weekly chart level does not currently work for Gold, it does still work for Silver. They do not have to complete the same structures for cycle wave b, and fairly often their structures are different.

DAILY CHART

Silver daily 2017
Click chart to enlarge.

For this first wave count, upwards movement for intermediate wave (C) must subdivide as a five wave structure. It may be unfolding as an impulse.

Within the impulse of intermediate wave (C), only minor wave 1 was over at the last high and now minor wave 2 may now be complete.

Minor wave 2 may have ended very close to the most likely point of the 0.618 Fibonacci ratio of minor wave 1 at 16.347.

Minor wave 1 lasted 44 days. Minor wave 2 may have completed in 20 days, just one short of a Fibonacci 21.

Minor wave 3 may only subdivide as an impulse. It would be very likely to show its subdivisions clearly at the daily chart level. Minute waves ii and iv within it should show up as multi day pullbacks or sideways consolidations. Minute wave ii now shows up at the weekly and daily chart levels.

Within minute wave iii, no second wave correction may move beyond its start below 16.602.

A base channel is added to minor waves 1 and 2. Downwards movement is finding very strong support at the lower edge of this base channel. If price breaks below the base channel, then the probability of this wave count would substantially reduce prior to invalidation.

This wave count now expects to see a strong increase in upwards momentum as a third wave up at three degrees unfolds. The fact that strong upwards movement has failed so far to materialise must reduce the probability now of this wave count.

SECOND WAVE COUNT

WEEKLY CHART

Silver daily 2017
Click chart to enlarge.

It remains possible for Silver that a large regular contracting or regular barrier triangle may be completing.

Within a triangle, one of the sub-waves must be a more complicated multiple, usually a multiple zigzag. This may be complete for primary wave B.

Primary wave C upwards may now be complete. The upper A-C trend line does have a fairly steep slope though, so it must be accepted that primary wave C may not be over and may continue higher. If it does, it may not move beyond the end of primary wave A above 21.062.

Primary wave C must subdivide as a three wave zigzag.

This triangle wave count now expects that primary wave D downwards may now be underway. Two scenarios for how it subdivides are presented below at the daily chart level.

Primary wave D of a contracting triangle may not move beyond the end of primary wave B below 15.197.

Primary wave D of a barrier triangle may end about the same level as primary wave B at 15.197; as long as the B-D trend line is essentially flat, the triangle will remain valid. Unfortunately, there is some subjectivity in this rule; it is not black and white.

DAILY CHART

Silver daily 2017
Click chart to enlarge.

Primary wave D must subdivide as a zigzag. Within the zigzag, intermediate wave (B) may be any corrective structure. At this stage, it may be a complete regular contracting triangle.

Minor wave E slightly overshoots the A-C trend line. Sometimes triangles end with a small overshoot.

If price begins to move strongly lower and makes a new low below 16.602, then confidence may be had in this wave count.

The target for primary wave D expects to see the most common Fibonacci ratio between intermediate waves (A) and (C).

ALTERNATE DAILY CHART

Silver daily 2017
Click chart to enlarge.

When an Elliott wave triangle is considered, it is vital to always consider alternate ways to label the triangle.

The triangle may be minor wave B within intermediate wave (B). The breakout may be upwards.

Within the triangle, minute wave e may not move beyond the end of minute wave c. A new low below 16.814 would invalidate this triangle idea and add some confidence to the main wave count above.

Within the zigzag of intermediate wave (B), minor wave C would be very likely to make at least a slight new high above the end of minor wave A at 17.094 to avoid a truncation.

TECHNICAL ANALYSIS

WEEKLY CHART

Silver Chart Weekly 2017
Click chart to enlarge. Chart courtesy of StockCharts.com.

The strongest week during this large consolidation is a downwards week ending 12th of June. However, this is stronger by only a small margin. The next strongest week is an upwards week. It may be better to look at daily volume bars to determine the most likely direction of a breakout from this consolidation.

The last two completed weeks moved price higher with an increase in volume. This is bullish.

Another weak bullish signal comes this week from On Balance Volume.

This chart supports the first and second alternate Elliott wave counts.

DAILY CHART

Silver Chart Daily 2017
Click chart to enlarge. Chart courtesy of StockCharts.com.

Volume suggests an upwards breakout from the symmetrical triangle.

The last day though is very bearish. The long upper wick is bearish as is volume.

From Dhalquist and Kirkpatrick regarding symmetrical triangles:

“The breakout is usually upwards (54% of the time). Symmetrical triangles have many false breakouts and must be watched carefully. The breakout commonly occurs between 73% and 75% of the length of the triangle from base to cradle. Throwbacks and pullbacks occur 37% and 59% of the time respectively, and, as in most patterns, when they occur, they detract from eventual performance. This implies that for actual investment or trading, the initial breakout should be acted upon, and if a pullback or throwback occurs, the protective stop should the tightened.”

And regarding trading triangles:

“The ideal situation for trading triangles is a definite breakout, a high trading range within the triangle, an upward-sloping volume trend during the formation of the triangle, and especially a gap on the breakout.

Although triangles are plentiful, their patterns suffer from many false and premature breakouts. This requires that a very strict breakout rule be used, either a wide filter or a number of closes outside the breakout zone. It also requires a close protective stop at the breakout level in case the breakout is false. Once these defensive levels have been exceeded, and price is on its way, the trader can relax for a little while because the failure rate after a legitimate breakout is relatively low Trailing stops should then be placed at each preceding minor reversal.”

For the example in the chart above, a breakout is required either above (54% likely) or below the trend lines. It should come soon now as price is close to about 75% the length of the triangle. It will be there in about two more days.

A gap on the breakout would increase performance. Volume supporting movement would also provide confidence. Stops may be set just above or below the triangle trend lines; below if an upwards breakout or above if a downwards breakout occurs. A position should be entered on the breakout, but do not wait for a throwback or pullback as it may not come.

Published @ 01:11 a.m. EST.

[Note: Analysis is public today for promotional purposes. Specific trading advice and comments will remain private for members only.]

Continue reading SILVER Elliott Wave Technical Analysis – 16th November, 2017

BTCUSD Elliott Wave and Technical Analysis – 13th November, 2017

Last analysis of Bitcoin expected more upwards movement, which is what has happened. Last published Bitcoin analysis is here.

All charts are on a semi-log scale.

FORTNIGHTLY CHART

Bitcoin 2 weekly 2017
Click chart to enlarge.

The data for this wave count begins from June 2010.

What looks like a five wave impulse may be completing. With no Fibonacci ratio between cycle waves III and I, it may be more likely that cycle wave V will exhibit a Fibonacci ratio to either of III or I.

This movement does not fit well at all into a channel.

I have taken some time to look at the waves which now in hindsight are obviously complete, particularly the waves within cycle wave III. I have noticed some tendencies of this market:

– Bitcoin behaves like an extreme commodity. Its impulses have a curved look with slower second waves, quick fourth waves, and strong sharp fifth wave extensions. This tendency shows up in bullish and bearish waves.

– Third waves are much longer than first waves, and fifth waves are longer still. Again, this is an extreme version of typical commodity behaviour.

– The middle of its third waves may exhibit Fibonacci ratios within them, but overall it does not regularly exhibit good Fibonacci ratios. This would make target calculation particularly difficult.

– Candlestick reversal patterns are common at the end of Bitcoin’s strong fifth waves. These are engulfing patterns or star patterns with very long wicks on the final candlestick.

– Early second wave corrections are extremely deep, close to 0.8 and often deeper than 0.9 the depth of the prior first wave.

The “forever” trend line should be used to indicate when the top may be in for BitCoin. If this line is breached, the probability of a crash will increase (it will not be certain, only highly likely).

Notice that Bitcoin completed strong blowoff tops at the end of both cycle waves I and III. At the end of cycle wave I, the rise for the last eight weeks was vertical. Again, at the end of cycle wave III, the rise for the last eight weeks was vertical (remember, this is a two weekly chart).

Notice that at this time the current rise is not vertical. Current price action looks more like the early stages of cycle waves I and III than their ends.

If my targets are wrong, they may be woefully inadequate. I would not recommend using these targets for exit points for any Bitcoin purchases.

WEEKLY CHART

Bitcoin weekly 2017
Click chart to enlarge.

Last analysis of Bitcoin expected more upwards movement, which is so far what is happening.

Primary wave 3 may be complete as labelled. Primary wave 5 may turn out to be only even in length with primary wave 3, but it may well be much longer than that. Within cycle wave III (not shown on this chart, see the two weekly chart above), primary wave 5 was just 26.45 short of 4.236 the length of primary wave 3.

Here, if primary wave 5 were to exhibit the same Fibonacci ratio to primary wave 3, the target would be at 23,626. While this target may seem extreme, it is possible.

TECHNICAL ANALYSIS

Bitcoin daily 2017
Click chart to enlarge.

At major highs, Bitcoin often exhibits strong candlestick reversal patterns. That is not the case at the last high.

Single divergence with price and RSI at the last high signalled a likely pullback. The question right now is: is this pullback complete?

At the end of pullbacks, Bitcoin does not always see RSI reach oversold. So that may not be useful in timing an entry. There are usually strong candlestick reversal patterns though, and there is one here. The last two days have long lower wicks and the last daily candlestick is very bullish. It is not correctly an engulfing pattern as the open gaps higher, but the close is well above the close of the prior day, which is very bullish.

The risk here is that the pullback is not yet over. Some patience may be required. A smaller position may be entered here, and most powder kept dry for a larger position should Bitcoin move lower.

Published @ 05:45 p.m. EST.

USD Index Elliott Wave and Technical Analysis – 10th November, 2017

The USD Index continued to move lower as the last Elliott wave analysis expected. The target for a low at primary degree was 94.83. The low was reached 3.01 below the target.

ELLIOTT WAVE ANALYSIS

MONTHLY CHART

US Dollar Elliott Wave Chart Monthly 2017
Click chart to enlarge.

A Super Cycle degree impulse looks to be incomplete for Super Cycle wave (I).

Cycle waves I, II and now III look complete within Super Cycle wave (I) impulse. Cycle wave III is just 0.50 longer than 1.618 the length of cycle wave I.

Ratios within cycle wave III are: there is no Fibonacci ratio between primary waves 3 and 1, and primary wave 5 is just 0.5 shorter than equality in length with primary wave 1. Primary wave 3 is the longest extension and has the strongest slope.

Cycle wave II was a deep 0.89 single or double zigzag lasting 26 months. Given the guideline of alternation, cycle wave IV may be expected to be a more shallow sideways correction which would likely be longer lasting. So far it has lasted just ten months.

WEEKLY CHART

US Dollar Elliott Wave Chart Weekly 2017
Click chart to enlarge.

A breach of the maroon Elliott channel provided an indication that cycle wave III was over and cycle wave IV had arrived.

If cycle wave IV is an expanded flat or a running triangle or a combination, then primary wave B or X within it may make a new high above the start of primary wave A or W at 103.82.

Primary wave B or X would most likely be a zigzag, but it may be any corrective structure. It may be a sharp upwards movement or a choppy overlapping time consuming consolidation.

For the short term, while price remains within the narrow yellow channel, assume the trend remains up.

DAILY CHART

US Dollar Elliott Wave Chart Daily 2017
Click chart to enlarge.

This labelling assumes that primary wave B may be a zigzag. But this labelling may need to change as primary wave B may be any one of more than 23 possible corrective structures.

The blue channel is an Elliott channel about the first five up. This may be intermediate wave (A). Assume the trend remains up while price remains within this channel.

Minute wave iv may not move into minute wave i price territory below 93.79.

TECHNICAL ANALYSIS

MONTHLY CHART

US Dollar Elliott Wave Chart Daily 2017
Click chart to enlarge. Chart courtesy of StockCharts.com.

ADX is still declining, so it does not yet indicate a trend.

Both the one and two year moving averages are now negatively sloped and price is below both. The one year average may be now crossing below the two year average. This would be a full bore bearish look.

With RSI not oversold and Stochastics exhibiting no divergence with price at lows, there is room for price to fall further.

It is very important to note that at the monthly chart level Gold and the USD Index do not have a reliable negative correlation. At this high time frame, they can spend months not correlated.

Each market should be and will be analysed separately. We cannot expect that analysis of one market showing movement expected in one direction means our analysis of the other market should show it to move in the opposite direction, because the math proves that is not the case often enough. To make this correlation assumption without looking at the math is dangerous to your trading account.

DAILY CHART

US Dollar Elliott Wave Chart Daily 2017
Click chart to enlarge. Chart courtesy of StockCharts.com.

Give the bearish engulfing candlestick pattern weight, because this suggests the Elliott wave count is wrong for the short term and a reasonable pullback or consolidation may develop about here.

The upwards trend here is extreme. Look out for a turn.

This analysis is published @ 03:00 a.m. EST.

GOLD Elliott Wave Technical Analysis – 1st November, 2017

Price is now beginning to move higher, which is what the Elliott wave counts both expected.

Summary: Upwards movement for a third wave should begin now. The first target is at 1,294 where a small consolidation may unfold. The target for this upwards swing to end is at 1,308, in the first instance, and may be as high as 1,380 (but this looks less likely now).

Reduce risk at this time to only 1-3% of equity on any one trade. Always trade with stops.

New updates to this analysis are in bold.

Last monthly charts for the main wave count are here, another monthly alternate is here, and video is here.

Grand SuperCycle analysis is here.

The wave counts will be labelled first and second. Classic technical analysis will be used to determine which wave count looks to be more likely. In terms of Elliott wave structure the second wave count has a better fit and fewer problems.

FIRST ELLIOTT WAVE COUNT

WEEKLY CHART

Gold Elliott Wave Chart Weekly I 2017
Click chart to enlarge.

There are more than 23 possible corrective structures that B waves may take, and although cycle wave b still fits well at this stage as a triangle, it may still be another structure. This wave count looks at the possibility that it may be a double zigzag.

If cycle wave b is a double zigzag, then current upwards movement may be part of the second zigzag in the double, labelled primary wave Y.

The target remains the same.

Within intermediate wave (C), no second wave correction may move beyond the start of its first wave below 1,205.41. However, prior to invalidation, this wave count may be discarded if price breaks below the lower edge of the black Elliott channel. If this wave count is correct, then intermediate wave (C) should not break below the Elliott channel which contains the zigzag of primary wave Y upwards.

There are now three problems with this wave count which reduce its probability in terms of Elliott wave:

1. Cycle wave b is a double zigzag, but primary wave X within the double is deep and time consuming. While this is possible, it is much more common for X waves within double zigzags to be brief and shallow.

2. Intermediate wave (B) within the zigzag of primary wave Y is a double flat correction. These are extremely rare, even rarer than running flats. The rarity of this structure must further reduce the probability of this wave count.

3. Although intermediate wave (C) should be continuing so that primary wave Y ends substantially above the end of primary wave W, the duration and depth of minor wave 2 within it now looks to be too large at the weekly time frame.

DAILY CHART

Gold Elliott Wave Chart Daily 2017
Click chart to enlarge.

The analysis will focus on the structure of intermediate wave (C). To see details of all the bull movement for this year see daily charts here.

Intermediate wave (C) must be a five wave structure, either an impulse or an ending diagonal. It is unfolding as the more common impulse.

It is possible that minor waves 1 and now 2 may both be over. Minor wave 2 may have ended very close to the 0.618 Fibonacci ratio. If it continues lower, then minor wave 2 may not move beyond the start of minor wave 1 below 1,205.41.

Minor wave 1 lasted 44 days and minor wave 2 may have lasted 20 days, just one short of a Fibonacci 21.

It is of some concern now that minor wave 3 appears to be starting out rather slowly and that minute wave ii within it is now a very deep correction.This is somewhat unusual for a third wave and offers some support now to the second Elliott wave count. With StockCharts data showing a steady decline in volume as price rises, this concern is validated.

A base channel is added to minor waves 1 and 2. If this wave count is correct, then lower degree second wave corrections should find support at the lower edge of the base channel. Friday’s candlestick is below the base channel, which now reduces the probability of this wave count.

Minute wave ii may now be over as a double zigzag structure.

It is again of concern that upwards movement this week does not have support from volume. The start of a third wave up at two degrees should be a strong movement.

HOURLY CHART

Gold Elliott Wave Chart Hourly 2017
Click chart to enlarge.

If minute wave ii is over as a very deep double zigzag, then it may have lasted a Fibonacci eight days.

Because minute wave ii here is so deep, the appropriate Fibonacci ratio to use to calculate a target for minute wave iii is 2.618.

Minute wave iii may only subdivide as a five wave impulse upwards. Minuette waves (i) and (ii) may now be complete.

Minuette wave (iii) may only subdivide as a five wave impulse. Within minuette wave (iii), subminuette wave i may be complete and subminuette wave ii may be incomplete. Subminuette wave ii may not move beyond the start of subminuette wave i below 1,267.97.

A base channel is added now to minuette waves (i) and (ii). Along the way up, lower degree corrections should find very strong support at the lower edge of the base channel. Gold almost always behaves like this; breaches of its base channels do happen, but they are uncommon.

The next wave up for this wave count would now be expected to be a third wave at four degrees.

SECOND ELLIOTT WAVE COUNT

WEEKLY CHART

Gold Elliott Wave Chart Weekly I 2017
Click chart to enlarge.

It is still possible that cycle wave b is unfolding as a regular contracting or barrier triangle.

Within a triangle, one sub-wave should be a more complicated multiple, which may be primary wave C. This is the most common sub-wave of the triangle to subdivide into a multiple.

Intermediate wave (Y) now looks like a complete zigzag at the weekly chart level.

Primary wave D of a contracting triangle may not move beyond the end of primary wave B below 1,123.08. Contracting triangles are the most common variety.

Primary wave D of a barrier triangle should end about the same level as primary wave B at 1,123.08, so that the B-D trend line remains essentially flat. This involves some subjectivity; price may move slightly below 1,123.08 and the triangle wave count may remain valid. This is the only Elliott wave rule which is not black and white.

Finally, primary wave E of a contracting or barrier triangle may not move beyond the end of primary wave C above 1,295.65. Primary wave E would most likely fall short of the A-C trend line. But if it does not end there, then it can slightly overshoot that trend line.

Primary wave A lasted 31 weeks, primary wave B lasted 23 weeks, and primary wave C lasted 38 weeks.

The A-C trend line now has too weak a slope. At this stage, this is now a problem for this wave count, the upper A-C trend line no longer has such a typical look.

Within primary wave D, no part of the zigzag may move beyond its start above 1,357.09.

DAILY CHART

Gold Elliott Wave Chart Daily 2017
Click chart to enlarge.

This second wave count expects the new wave down may be deeper and longer lasting than the first wave count allows for. At this stage, in the middle of this downwards wave intermediate wave (B) looks incomplete.

A common length for triangle sub-waves is from 0.8 to 0.85 the length of the prior wave. Primary wave D would reach this range from 1,170 to 1,158.

If primary wave C is correctly labelled as a double zigzag, then primary wave D must be a single zigzag.

Within the single zigzag of primary wave D, intermediate wave (A) is labelled as a complete impulse.

Intermediate wave (A) lasted twenty days, just one short of a Fibonacci twenty-one. Intermediate wave (B) may be about the same duration, so that this wave count has good proportions, or it may be longer because B waves tend to be more complicated and time consuming.

So far intermediate wave (B) has lasted eighteen sessions. The next Fibonacci number in the sequence is twenty-one which would see it continue now for another three sessions.

At its conclusion intermediate wave (B) should have an obvious three wave look to it here on the daily chart.

Minor wave B may be complete here or close to completion as a double zigzag.

Minor wave A will subdivide as either a five wave impulse or a three wave zigzag. If it is seen as a zigzag, then the whole structure for intermediate wave (B) may be a flat correction, which would allow for minor wave B to move below the start of minor wave A at 1,260.72.

HOURLY CHART

Gold Elliott Wave Chart Hourly 2017
Click chart to enlarge.

Intermediate wave (B) may be a regular flat correction. Within intermediate wave (B), minor wave B has passed the minimum requirement of 0.90 the length of minor wave A. B waves within 0.90 to 1.05 the length of A waves indicate a regular flat correction. The most common length for C waves within regular flats is equality in length with the A wave.

Minor wave C would be extremely likely to make at least a slight new high above the end of minor wave A at 1,305.72 to avoid a truncation.

Both wave counts require a five wave structure upwards to complete. For this second wave count it would be labelled minor wave C.

So far, within minor wave C, minute waves i and now ii may be complete. This second wave count also expects a third wave up to now begin, but only at two degrees. Some increase in upwards momentum should be expected, and it should have support from volume.

The current small pullback, which is here labelled minuette wave (ii), looks incomplete. This hourly chart shows a slightly different way of labelling most recent movement. A small triangle may be completing for subminuette wave b within a zigzag downwards for minuette wave (ii).

When this second wave correction is complete, then an increase in upwards momentum would be expected.

Minuette wave (ii) may not move beyond the start of minuette wave (i) below 1,267.97.

TECHNICAL ANALYSIS

WEEKLY CHART

Gold Weekly 2017
Click chart to enlarge. Chart courtesy of StockCharts.com.

What looks like a possible double bottom here with the last swing low three weeks ago is too small to be classified as a correct double bottom. The two troughs of a double bottom should be about 10% from the peak in between. Here, they are only 3.6% from the peak.

The long lower wick on the last completed weekly candlestick is bullish, but volume tells a different story as it is bearish.

On Balance Volume may again lead the way. Support may force a bounce here.

DAILY CHART

Gold Daily 2016
Click chart to enlarge. Chart courtesy of StockCharts.com.

Price is very clearly consolidating. Expect swings from support to resistance and back again. Use Stochastics in conjunction with support and resistance to signal when each swing ends. Be aware that trading a consolidating market is much more risky than trading a trending market, and reduce risk accordingly. Only experienced traders should consider trading the swings within a consolidation. Reduce risk to 1-3% of equity. Always trade with stops. Here, move stops to a little below support and above resistance to allow for overshoots; give the market room to move.

With Stochastics very close to oversold and price at support, an upwards swing may begin here or very soon. Look for resistance about 1,305 – 1,310. This also supports the second Elliott wave count.

Volume and On Balance Volume are today more clearly bullish giving some confidence that an upwards swing may be beginning now.

GDX DAILY CHART

Gold Daily 2016
Click chart to enlarge. Chart courtesy of StockCharts.com.

GDX broke below support four days ago, on a downwards day with support from volume. This looks still like a classic downwards breakout. It is common after breakouts for price to curve back and test support or resistance, and that looks like what is happening today.

The longer upper wick on today’s candlestick looks a little bearish. It looks like GDX may now begin to move down and away.

However, volume for this downwards movement is very light, so it is suspicious.

If price moves back above resistance at 22.75, then the consolidation zone may have to be widened. If this happens, then expect an upwards swing to next resistance about 23.95.

But the bottom line for GDX today is it is in a downwards trend. Assume GDX remains so while price remains below resistance at 22.75. With weakness still, traders should take profits or keep trailing stops tight.

Published @ 06:00 p.m. EST.

[Note: Analysis is public today for promotional purposes. Specific trading advice and comments will remain private for members only.]

Continue reading GOLD Elliott Wave Technical Analysis – 1st November, 2017

The Strongest Technical Signal for Google | 31st October, 2017

In keeping with the KISS principle, this trend line is very simple. I call it “Google’s Forever Trend Line”.

GOOG 2017
Click chart to enlarge.

This trend line has very strong technical significance. It is very long held and has been tested multiple times. It does have a reasonably steep slope, but because the entire history of Google price remains above this line a breach of the line would still offer a very strong bearish signal.

We should assume the upwards trend remains intact while price remains above the line. Each time price comes close to the forever trend line, and remains above it, then a low risk high reward entry opportunity to join the upwards trend is offered.

Published @ 01:51 a.m. EST.