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Yesterday’s analysis expected downwards movement which is what happened. The short term target at 1,241 was not met as price has fallen 10.76 short before turning upwards for another correction.

The wave count remains the same.

Click on the charts below to enlarge.

Gold Elliott Wave Chart Daily 2013

This is the main wave count with the highest probability. Flat corrections are extremely common structures, particularly in fourth waves. Primary wave 2 was a rare running flat, and primary wave 4 may exhibit alternation if it is a more common expanded flat or a still common regular flat. Primary wave 4 may also exhibit alternation if it is shallow; primary wave 2 was very deep.

Primary wave 2 lasted 53 weeks. It would be likely that primary wave 4 will continue for longer to be better in proportion to primary wave 2.

It is most likely that primary wave 4 is not over and is unfolding as a large flat correction. Within the flat intermediate wave (B) is an incomplete double zigzag. Within the second zigzag of this double, labeled minute wave y, minuette wave (ii) may not move beyond the start of minuette wave (i). This wave count is invalidated at this stage and for some time yet with movement above 1,532.90.

Within the flat correction intermediate wave (B) must be at least 90% the length of intermediate wave (A). This wave count requires more downwards movement to this minimum at 1,205.74.

Within an expanded flat the B wave is 105% the length of the A wave, so this wave count allows for a new low as quite likely, because expanded flats are the most common type of flat.

Intermediate wave (B) would be about three or so weeks away from ending.

GOLD Elliott Wave Chart Hourly 2013

The target calculated for subminuette wave iii to end at 1,241 was based upon micro wave 5 reaching equality with micro wave 3. Price fell well short of the target.

I am changing the wave count for this downwards movement to better fit with Fibonacci ratios and momentum. If subminuette wave iii ended at the last low, as yesterday’s wave count would have expected it did, then it would look more like a three than a five wave impulse.

I expect that now only subminuette wave i within minuette wave (iii) is complete. I would expect therefore more upwards movement for subminuette wave ii.

Ratios within subminuette wave i are: the full length of micro wave 3 is 4.02 short of 1.618 the length of micro wave 1, and micro wave 5 is 3.1 longer than equality with micro wave 1.

The end of the third wave corresponds with the strongest downwards momentum as indicated by MACD, and the fourth wave corresponds with MACD touching the zero line. This wave count has a typical look and fit.

I would expect subminuette wave ii to last about one or two days. It should be choppy and overlapping. It is most likely to be a zigzag structure, and to reach up to about the 0.618 Fibonacci ratio at 1,299.61.

Movement above 1,294.78 would invalidate yesterday’s hourly wave count and confirm that upwards movement must be a second wave correction.

Subminuette wave ii may not move beyond the start of the first wave. This wave count is invalidated with movement above 1,330.09.

Alternate Daily Wave Count.

Gold Elliott Wave Chart Daily 2013

This wave count has the lowest probability because it would see primary wave 4 as having lasted only 9 weeks. Compared to primary wave 2 having lasted 53 weeks, this lack of proportion gives this alternate wave count the wrong look at the weekly chart level. This significantly reduces the probability of this wave count.

This alternate expects very strong downwards movement as the middle of a third wave unfolds. If the next wave down shows a very strong increase in momentum then I would more seriously consider this alternate.

At 1,174 minor wave 3 would reach 1.618 the length of minor wave 1.

Subminuette wave ii may not move beyond the start of subminuette wave i. This wave count is invalidated with movement above 1,352.90.