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A little downwards movement was expected, but I had not expected it to be this deep or last this long for the main wave count. However, on the hourly chart the structure looks typical and the wave count has the right look. Both hourly wave counts remain valid. The point of differentiation is now 1,294.60.

Summary: The short term trend still remains up overall. Both wave counts expect to see new highs above 1,306.83 this week. Price may move clearly up (main wave count) or mostly sideways in very choppy overlapping movement (alternate).

This analysis is published about 04:30 p.m. EST. Click on charts to enlarge.

Gold Elliott Wave Chart Daily 2014

Gold is still within a large fourth wave correction at primary wave degree which is incomplete.

Primary wave 2 was a rare running flat. Primary wave 4 is unlikely to be a flat correction because it is likely to show structural alternation with primary wave 2.

Primary wave 4 is most likely to be completing as a double combination: zigzag – X – second structure. The second structure labeled intermediate wave (Y) is most likely to be a flat correction. Within the flat correction minor wave B must reach a minimum 90% the length of minor wave A at 1,201.98.

Overall the structure for primary wave 4 should take up time and move price sideways, and the second structure should end about the same level as the first at 1,434. Primary wave 4 may not move into primary wave 1 price territory. This wave count is invalidated with movement above 1,532.90.

Primary wave 4 may also be a large contracting triangle, but at this stage this idea does not have the “right look” and so I will not publish a chart for it. I will continue to follow this idea and will publish a chart in coming weeks for it if it shows itself to be correct. At this stage there is no divergence between wave counts for a triangle or a double combination.

GOLD Elliott Wave Chart Hourly 2014

This main wave count follows the idea that minor wave B may be unfolding as a flat correction. Within the flat correction minute wave a subdivides as a single zigzag. Minute wave b within the flat must reach a minimum of 90% the length of minute wave a at 1,380.82.

Minute wave b is most likely to subdivide as a single or double zigzag in order to reach 1,380.82. The first wave up should subdivide as a five and it is incomplete.

Subminuette wave iii is 2.07 short of 1.618 the length of subminuette wave i. At 1,313 subminuette wave v would reach equality in length with subminuette wave i. If subminuette wave iv moves any lower it may not move into subminuette wave i price territory below 1,294.60.

Subminuette wave iii shows a clear increase in upwards momentum which fits this wave count perfectly. Subminuette wave iv may have lasted 23 hours, while subminuette wave ii lasted 22 hours. They are nicely in proportion. Subminuette wave iv has come close to the lower edge of the parallel channel. This gives the wave count a typical look.

When minuette wave (a) is a completed five wave structure then the following downwards movement for minuette wave (b) should last one or two days and may not move below the start of minuette wave (a) at 1,277.79.

Alternate Hourly Wave Count.

GOLD Elliott Wave Chart Hourly Alternate 2014

This alternate wave count follows the idea that minor wave B may be unfolding as a double zigzag. The first zigzag downwards is labeled minute wave w. The double should be joined by a “three” in the opposite direction which may subdivide as any corrective structure labeled minute wave x.

Because 1-2-3 and A-B-C subdivide in exactly the same way I am adjusting this alternate to see a three up complete. This may be minuette wave (a) of a flat correction of minuette wave (w) of a double zigzag or double combination.

If minute wave x is unfolding as a flat correction then within it minuette wave (b) must move lower to reach a minimum 90% the length of minuette wave (a) at 1,280.70.

If minute wave x is unfolding as a double then there is no minimum downwards requirement for minuette wave (x) within it.

Note: Within multiples (doubles and triples) subwaves W, Y and Z may only subdivide as simple A-B-C corrections. However, X waves may be any corrective structure, including multiples. Any wave count which you see that labels the subwaves of W, Y and Z as W-X-Y(-Z) is invalid and so would have absolutely zero predictive quality. However, it is one of the most common mistakes I see from others who are beginning with Elliott wave.