Tag Archives: elliott wave count on gold

GOLD Elliott Wave Technical Analysis – 5th December, 2017

A classic triangle pattern was identified in recent analysis. Price has broken downwards out of the pattern today, which was the expected direction.

Members were advised on the 28th of November to expect downwards movement. On the 1st of December, members were given specific trading advice to enter short for either just a short position or for the short side of a hedge. Those positions should now be profitable.

Advice is given today on how to manage short positions.

Continue reading GOLD Elliott Wave Technical Analysis – 5th December, 2017

GOLD Elliott Wave Technical Analysis – 30th October, 2017

Both Elliott wave counts were expecting upwards movement to begin the new trading week, which is so far what has happened.

There is an important signal from On Balance Volume today, but it is strongly contradicted by volume for Monday’s session.

Continue reading GOLD Elliott Wave Technical Analysis – 30th October, 2017

GOLD Elliott Wave Technical Analysis – 4th October, 2017

All three hourly Elliott wave charts published yesterday expected at least some upwards movement. So far that is what has happened. Classic analysis will be used today to judge which of the three scenarios looks most likely.

Summary: Assume the trend remains down while price remains below 1,289.67.

A new high above 1,289.67 (the high for 2nd of October) by any amount at any time frame would indicate more upwards movement. At that stage, use the target at 1,330 – 1,334 in the first instance.

If upwards movement shows reasonable strength with support from volume, then it may go as high as 1,420, but that would require a new high above 1,357.09 for reasonable confidence.

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.

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.

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 two 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.

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 wave 1 may have been over at the last high and the current pullback may be minor wave 2. Minor wave 2 may not move beyond the start of minor wave 1 below 1,205.41.

Minor wave 2 may not be over and may continue lower to reach a more normal depth of about 0.618 the length of minor wave 1, about 1,261. This would also see minor wave 2 have a better proportion to minor wave 1 in terms of duration; minor wave 1 lasted 44 days and so far minor wave 2 has lasted only 18 days. If it continues now for another 3 days, it may total a Fibonacci 21.

HOURLY CHART

Gold Elliott Wave Chart Hourly 2017
Click chart to enlarge.

BarChart have fixed the problem with their data for current data, but the problem of past data for the sessions from 28th September to 2nd of October is not fixed. As members can see, the data for the whole of minuette wave (b) is still wrong. This was probably some kind of combination; I will analyse that when the data is fixed. At this time, it will make no difference at all to the analysis because it is clear that minuette wave (b) is over no matter what structure it was.

I have checked the subdivisions within minuette wave (c) on PMBull data and this will subdivide neatly into a five wave structure at the hourly chart level.

If minuette wave (c) is not complete, then only subminuette waves i and now ii within it may be over. Subminuette wave ii may be a zigzag that may have ended very close to the 0.618 Fibonacci ratio of subminuette wave i.

However, to see subminuette wave ii as a completed three wave zigzag results in the subdivisions not having as neat a fit as when we see this upwards movement as a five wave structure. Either my labelling here of subminuette wave ii as complete is wrong and it may move higher, or either of the alternate below or the second hourly Elliott wave chart below is right.

This hourly wave count now expects another wave down with some increase in momentum for subminuette wave iii.

If the target for this hourly wave count is wrong, it may not be low enough.

If it continues further, then subminuette wave ii may not move beyond the start of subminuette wave i above 1,289.67.

Price remains so far within the best fit channel, copied over from the daily chart. While price remains within that channel, then no confidence in the idea of a low in place for Gold may be had.

ALTERNATE HOURLY CHART

Gold Elliott Wave Chart Hourly 2017
Click chart to enlarge.

It is possible to see that minor wave 2 could be over by simply moving the degree of labelling within minuette wave (c) all up one degree.

This wave count requires a new high above the high for the 2nd of October (which for BarChart data was at 1,289.67) before any confidence may be had in it.

The trend remains the same until proven otherwise. Assume the trend is down until price proves it is not.

If the next wave up is the start of a third wave at minor degree, then it should have support from volume. Upwards movement does have some support from volume today, but the weak candlestick is problematic for this wave count.

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 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.

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 an incomplete impulse.

Within intermediate wave (A), minor wave 1 will fit as a five wave impulse. While it is possible that minor wave 2 could have been over at the high for the 25th of September, it would be remarkably brief and shallow; the proportions between minor waves 1 and 2 would be very poor.

It is still more likely that minor wave 2 is continuing further as an expanded flat correction. Expanded flats are very common structures. The most common length for their B waves is from 1 to 1.38 times the length of their A waves. Here, minute wave b is now a 1.80 length to minute wave a. This is longer than the most common length but still within allowable limits of up to 2 times the length of minute wave a.

If price continues lower to 1,263 or below, then minute wave b would reach 2 times the length of minute wave a. At that stage, the idea of an expanded flat correction would be discarded based upon a very low probability.

The structure of minute wave b now looks to be complete at the hourly chart level. Here, on the daily chart, it looks like a three wave structure. So far this idea of an expanded flat currently unfolding still has a very good look.

HOURLY CHART

Gold Elliott Wave Chart Daily 2017
Click chart to enlarge.

If price makes a new high above 1,289.67, then both the alternate hourly chart for the first wave count and this hourly chart for the second wave count will be possible. This wave count expects that upwards movement may be more brief: only minute wave c to end minor wave 2 of an expanded flat.

Expanded flats are very common structures. They can be identified as viable possibilities by looking for weakness within their B waves. Here, minute wave b shows a strong decline in volume and a decline in ATR. This offers some support to this wave count. However, there is no divergence with Stochastics at recent lows to indicate weakness, which is often a feature of B waves within expanded flats (often is not the same as always).

Because minute wave b is longer than 1.618 the length of minute wave a, the appropriate target for minute wave c is calculated using the 2.618 Fibonacci ratio. Minute wave c would be extremely likely to make at least a slight new high above the end of minute wave a at 1,292.62 to avoid a truncation and a very rare running flat correction.

Minor wave 2 may not move beyond the start of minor wave 1 above 1,357.09. This is the price point now which differentiates this second Elliott wave count from the first Elliott wave count.

Minute wave c must subdivide as a five wave structure. It would most likely be an impulse, but the less common ending diagonal should be considered if upwards movement is overlapping.

Upwards movement to the high labelled minuette wave (i) for this session will fit as a leading expanding diagonal. Second wave corrections following first wave leading diagonals are usually very deep. For this reason I would expect it to be most likely to see minuette wave (ii) move lower.

Minuette wave (ii) may not move beyond the start of minuette wave (i) below 1,268.42.

TECHNICAL ANALYSIS

WEEKLY CHART

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

Support of the Elliott wave counts which expect overall more downwards movement this week comes from an increase in volume last week for downwards movement, a bearish upper candlestick wick, and a weak bearish signal now from On Balance Volume.

These signals cannot tell us how far price may fall though. Support and resistance may be used as a guide for this. Next strong support for price is about 1,225.

DAILY CHART

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

Price has reacted from resistance about 1,285. The long upper wick on today’s candlestick is bearish. This supports the second Elliott wave count which sees a bounce within a downwards trend and not a trend change at the low.

Upwards movement has support today from volume, so more upwards movement for at least another day may be expected.

On Balance Volume may assist here to show when upwards movement may end at resistance.

The lack of divergence between price and Stochastics at the last low, and RSI not yet oversold, suggests that there is more downside still.

It is my judgement that this classic analysis best supports the second Elliott wave count today.

GDX

DAILY CHART

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

Upwards movement for GDX at this stage looks very much like a small bounce within a larger downwards trend. If resistance at 23.45 gives way, then look for next resistance about 23.85. However, light volume with a small green doji today looks like the bounce may be done here.

The one strong note of caution to the above statement is a bullish signal today from On Balance Volume. The purple trend line was strong, but has recently been weakened with a move below it. Now it may rise further given that On Balance Volume is above this line again.

Like Gold, GDX did not exhibit any divergence with Stochastics at the last low nor did RSI reach oversold. There is room for price to move lower.

Published @ 10:17 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 – 4th October, 2017

GOLD Elliott Wave Technical Analysis – 17th May, 2017

Price remained within channels and continued higher.

Today’s strong upwards session with heavy volume looks like a blowoff top.

Summary: It looks like a blow off top may have ended upwards movement today. However, price remains within the best fit channels. While price remains within the steeper channel particularly, expect it to keep going up. When the channel is breached, it would be likely price has changed trend.

New updates to this analysis are in bold.

Last historic analysis with monthly charts is here, video is here.

Grand SuperCycle analysis is here.

MAIN ELLIOTT WAVE COUNT

For clarity I have decided at this time it may be best to publish on a daily basis weekly charts I and II. Both charts expect a zigzag down to complete and the difference is in the expected depth.

WEEKLY CHART I

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

Combinations are very common structures. Cycle degree waves normally last one to several years, and B waves do tend to be more time consuming waves than all other waves. Given these tendencies the most likely scenario at this point may be that cycle wave b is an incomplete double combination.

The first structure in the double labelled primary wave W fits as a zigzag. This upwards movement will subdivide as either a three (zigzag) or a five (impulse). It does have a three wave look to it.

The double is joined by a deep three in the opposite direction labelled primary wave X, which is a 0.77 depth of primary wave W. X waves within double combinations are normally very deep; this one looks right.

The second structure in the combination may be either a triangle or a flat correction. Both of these structures have A waves which subdivide as threes.

At this stage, the upwards wave from the low in December 2016 does now look best and subdivide best as a completed zigzag. This may be intermediate wave (A) of a flat correction or a triangle. Because a triangle for primary wave Y would look essentially the same as the second weekly chart below, only a flat correction is considered here. The most common two structures in a double combination are a zigzag and a flat.

This wave count follows the most common scenario and has the best fit.

Within the flat correction of primary wave Y, intermediate wave (B) must retrace a minimum 0.9 length of intermediate wave (A) at 1,140.27. The most common length for intermediate wave (B) is from 1 to 1.38 times the length of intermediate wave (A), giving a common range from 1,123.08 to 1,057.77.

Intermediate wave (B) may subdivide as any corrective structure, but the most common structure for B waves within flats is a zigzag. At this stage, on the hourly chart it looks like a five down is now complete, which would indicate intermediate wave (B) is a zigzag subdividing 5-3-5.

The daily and hourly charts will follow this weekly chart. That does not mean the other two weekly charts aren’t possible, they are, but the number of charts must be kept reasonable on a daily basis.

WEEKLY CHART II

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

What if cycle wave b is a triangle? This is also entirely possible. Triangles are not as common as double combinations, but they are not uncommon.

Within the triangle, primary waves A, B and C are all single zigzags. One of the five subwaves of a triangle normally subdivides as a more complicated multiple, usually a double zigzag. This may be what is unfolding for primary wave D.

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

Primary wave D of a regular barrier triangle should end about the same level as primary wave B at 1,123.08, so that the B-D trend line is essentially flat. What this means in practice is that primary wave D may end slightly below 1,123.08 and the triangle would remain valid. This is the only Elliott wave rule which is not black and white.

Thereafter, primary wave E should unfold upwards and would most likely fall a little short of the A-C trend line. If not ending there, it may overshoot the A-C trend line.

At this stage, the structure on the hourly chart is still the same for both this weekly wave count and the first weekly wave count: a zigzag downwards is unfolding. However, they now diverge in how far down the next wave is expected to go. This second weekly wave count expects a more shallow movement to not end reasonably below 1,123.08.

DAILY CHART

Gold Elliott Wave Chart Daily 2017
Click chart to enlarge.

This daily chart will suffice for both weekly charts above, although the labelling follows weekly chart I.

Both weekly charts expect a zigzag downwards. Weekly chart I expects a deep zigzag for intermediate wave (B) to a minimum at 1,140.27. Weekly chart II expects a zigzag down for primary wave D to not move below 1,123.08 and most likely fall well short of that point.

The daily chart follows the expectations for weekly chart I, but the structure for weekly chart II would be exactly the same.

Within the flat correction of primary wave Y, intermediate wave (B) must retrace a minimum 0.9 length of intermediate wave (A) at 1,140.27. The most likely corrective structures to achieve the deep correction required for B waves within flats are single or multiple zigzags. These begin with a five, then a three in the opposite direction.

Minor wave A is complete today and now minor wave B may also be complete as a quick sharp zigzag. Because of the blowoff top today that looks to be most likely.

However, there can be no confidence yet that minor wave B is over while price remains within both small channels on the hourly chart. Accept that it may continue higher.

Original targets for minor wave B were the 0.382 and 0.618 Fibonacci ratios. Minor wave B today has almost touched the 0.618 Fibonacci ratio, which is at 1,264.34.

If minor wave B continues higher, it may not move beyond the start of minor wave A above 1,294.96.

HOURLY CHART

Gold Elliott Wave Chart Hourly 2017
Click chart to enlarge.

Two narrow best fit channels are drawn about this upwards movement. It is very important that members do not have confidence yet that minor wave B is over while price remains within the channels. Only when the first channel is clearly breached may any confidence be had. Reasonable confidence in a trend change may be had if the second channel is breached.

The blow off top seen today may have been minute wave c. C waves can behave like third waves, and third waves often end in blow off tops.

If minor wave B moves higher, then the target calculated for minor wave C must also move correspondingly higher.

If minor wave C lasts a total of 12 sessions, then intermediate wave (B) may last a total Fibonacci 34 sessions.

It is my judgement that this first hourly chart has a higher probability for the following reasons:

– Today’s session completes a blow off top, and this may be followed by a reversal.

– The 0.618 Fibonacci ratio is almost met.

– Price found resistance about 1,260.

ALTERNATE HOURLY CHART

Gold Elliott Wave Chart Hourly 2017
Click chart to enlarge.

It is also possible that upwards movement for the last six sessions is a complete five wave impulse.

The blow off top may be followed by a consolidation for a B wave within a B wave. This may take a few days.

Thereafter, another upwards wave may make minor wave B very deep indeed, deeper than the 0.618 Fibonacci ratio.

This is possible, but it has a lower probability than the main hourly wave count.

WEEKLY CHART IV

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

This weekly chart is published today in response to a member’s query.

What if the bull market beginning in December 2015 remains intact? Price has essentially been moving sideways since that date, so all possibilities should be considered.

A possible Morning Doji Star reversal pattern at the low labelled intermediate wave (B) would support this wave count.

This wave count requires confirmation above 1,294.96. That would invalidate the first three weekly charts (the third is seen in historic analysis only).

It is possible that cycle wave b is continuing higher as a double zigzag. However, double zigzags normally have brief and shallow X waves. The purpose of the second zigzag in a double (and the third when there is one) is to deepen the correction when price does not move deep enough in the first (or second) zigzag. Thus double (and triple) zigzags normally have a strong and clear slope against the prior trend. To achieve this look their X waves normally are brief and shallow.

In this case, primary wave X is neither brief nor shallow. It is a 0.77 depth of primary wave W and lasted 0.74 the duration of primary wave W. Overall, this does not have a typical look of a double zigzag so far.

This wave count should only be used if confirmed with a new high above 1,294.96. Low probability does not mean no probability, but should always be given less weight until proven.

TECHNICAL ANALYSIS

WEEKLY CHART

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

Another downwards week closes green with a small real body. This is a spinning top candlestick that shifts the trend from down to neutral.

The balance of volume is upwards and shows a decline. Upwards movement may be a counter trend movement if it does not have support from volume.

The bullish signal from On Balance Volume suggests this week may see upwards movement.

DAILY CHART

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

Today’s session looks very much like a strong blow off top, typical of commodities. Expect either a sideways consolidation for a few days, or a reversal, after a blow off top.

There is slight bearish divergence between price and On Balance Volume to support the view of a reversal here.

There is room for price to rise further; neither RSI nor Stochastics are yet overbought.

If this is a new trend, then it is concerning that Bollinger Bands continue to contract. This trend still lacks expanding volatility.

GDX

DAILY CHART

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

There is no gap between the 15th and 17th of May because the high of the 15th was 23.13 and the low for the 17th was exactly the same.

While this upwards day came with stronger volume, the last four upwards sessions have come with a steady decline in volume. This session looks like it may possibly be a smaller blow off top.

The spinning top candlestick of this session indicates indecision, a balance of bulls and bears.

This upwards movement of the last nine days still has declining ATR, contracting Bollinger Bands, and overall lighter volume than the prior downwards movement. Overall, it still looks more likely to be a counter trend bounce than a new trend for GDX.

With Stochastics now overbought and a spinning top candlestick pattern, members are advised to wait one more day to see if a reversal pattern emerges.

This analysis is published @ 09:40 p.m. EST.

[Note: Analysis is public today for promotional purposes. Member comments and discussion will remain private.]

Continue reading GOLD Elliott Wave Technical Analysis – 17th May, 2017

GOLD Elliott Wave Technical Analysis – 5th April, 2017

Upwards movement was expected. Price moved lower, but has rebounded strongly after the session closed. Downwards movement remained above the invalidation point on the hourly chart.

Continue reading GOLD Elliott Wave Technical Analysis – 5th April, 2017

GOLD Elliott Wave Technical Analysis – 7th February, 2017

A small range inside day fits both Elliott wave counts, but the situation is no clearer.

Continue reading GOLD Elliott Wave Technical Analysis – 7th February, 2017

GOLD Elliott Wave Technical Analysis – 20th December, 2016

A small downwards day fits the preferred expectations for Gold, but all Elliott wave counts remain valid. Targets remain the same.

Continue reading GOLD Elliott Wave Technical Analysis – 20th December, 2016