The target for upwards movement in the short term, expected to be reached today, was 1,203 – 1,205. Price has only managed to move very slightly higher to 1,195.12.
Summary: The new main wave count expects the trend is up at cycle, primary, intermediate and minor degrees. At this stage minor wave 1 is close to an end, and I expect a sideways triangle for a fourth wave to complete and be followed by a short brief final wave up which may be about $17 in length, although it could be shorter. A clear breach of the upwards sloping pink channel on the hourly chart will be first indication that minor wave 1 is over and minor wave 2 down has begun. Minor wave 2 should last two or three days.
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Main Daily Wave Count
After consideration at the weekly chart level, I have moved the degree of labelling within cycle wave b up one degree. When the current 5-3-5 zigzag labelled primary A-B-C is complete I will have alternate wave counts which again move the degree of labelling within cycle wave b back down one degree, because this may also be only primary wave A as a zigzag within a flat, triangle or combination for cycle wave b. Or it could be a shallow quick zigzag for cycle wave b as labelled. All possibilities are equally likely.
A new high above 1,308.10 would invalidate the alternate and confirm this main wave count at primary and cycle degree.
The upwards wave labelled primary wave A fits only as a five wave structure, a leading expanding diagonal. Within a leading diagonal the first, third and fifth waves are most commonly zigzags, and the fourth wave should overlap first wave price territory.
Because primary wave A subdivides as a five, primary wave B may not move beyond its start below 1,131.09.
At 1,320 primary wave C would reach equality in length with primary wave A. This would complete a 5-3-5 zigzag trending upwards. At that stage alternate wave counts would be required to manage the various possibilities for cycle wave b.
At 1,429 primary wave C would reach 1.618 the length of primary wave A.
Because primary wave A is a diagonal then it is highly likely primary wave C will be an impulse in order to exhibit alternation. Primary wave C may end about the upper edge of the channel drawn about cycle wave b.
This wave count sill has problems of structure within primary wave 5 of cycle wave a:
– within primary wave 5 intermediate wave (2) is a running flat within its C wave, looking like a three and not a five.
– within intermediate wave (5) the count is seven which is corrective; either minor wave 3 or 5 will look like a three wave structure on the daily chart where they should be fives.
It is for these reasons that I will retain the alternate until price confirms finally which wave count is correct and which is invalidated.
Minor wave 1 is close to completion.
Minute wave iii did not move higher and was over at 1,191.72. Minute wave iii is just 0.73 longer than 2.618 the length of minute wave i.
Ratios within minute wave iii are: there is no Fibonacci ratio between minuette waves (i) and (iii), and minuet wave (v) is just 0.06 longer than 0.382 the length of minuette wave (i).
Minute wave iv looks like it may be an almost complete running contracting triangle. For the triangle to remain valid minuette wave (d), if it continues, may not move beyond the end of minuette wave (b) above 1,195.12. Minuette wave (e) may not move below the end of minuette wave (c) below 1,186.11. If this lower price point is breached then minute wave iv would most likely be unfolding sideways as a combination. If the triangle holds then expect minute wave (e) to be highly likely to fall short of the (a)-(c) trend line.
If the triangle holds and completes as expected then the final fifth wave up for minute wave v would be very likely to be more brief and short than usual. It may reach equality in length with minute wave i at 17.18, but if this expectation is wrong it would be too optimistic. Minute wave v may be even shorter than this, because fifth waves following triangles are often surprisingly short and quick.
While minute wave iv is unfolding it may not move back into minute wave i price territory below 1,160, although it should not get anywhere near that point as it should just continue sideways. It should end within the price territory of the fourth wave of one lesser degree between 1,187.30 and 1,179.45.
When minor wave 1 can be seen as a completed five wave impulse then a trend change should be expected. Minor wave 2 should show up on the daily chart and is likely to last about two or three days. The invalidation point must move down to the start of minor wave 1 at 1,142.82. Draw a Fibonacci retracement along the length of minor wave 1. The 0.382 and more likely the 0.618 Fibonacci ratios would be expected targets for minor wave 2.
Draw the channel about minor wave 1 using Elliott’s technique: draw the first trend line from the highs labelled minute waves i to iii, then place a parallel copy on the low labelled minute wave ii. Minute wave v may end at the upper edge of the channel. When this channel is breached by subsequent downwards movement that shall provide trend channel confirmation that minor wave 1 is over and minor wave 2 has begun.
Alternate Daily Wave Count
This alternate wave count sees Gold as still within a primary degree downwards trend, and within primary wave 5 intermediate wave (3) has begun.
At 956.97 primary wave 5 would reach equality in length with primary wave 1. Primary wave 5 may last a total Fibonacci 55 weeks. So far it is now beginning its 36th week.
The maroon channel about cycle wave a from the weekly chart is now breached by a few daily candlesticks and one weekly candlestick. If cycle wave a is incomplete this channel should not be breached. The breach of this channel is a warning this wave count may be wrong.
This wave count still has a better fit in terms of better Fibonacci ratios, better subdivisions and more common structures within primary wave 5, in comparison to the main wave count above.
Within intermediate wave (3) minor wave 1 is a long extension. Within minor wave 1 minute waves iv and ii are grossly disproportionate, with minute wave iv more than 13 times the duration of minute wave i. This also reduces the probability of this wave count.
A new low below 1,131.09 would confirm that intermediate wave (3) down is underway.
Minor wave 2 may not move beyond the start of minor wave 1 above 1,308.10. It may end about the 0.382 Fibonacci ratio. Because this is a second wave within a third wave one degree higher it should be expected to be more brief and shallow than a second wave correction normally is.
Minor wave 2 may be unfolding as a double zigzag, with the second zigzag in the double close to completion. At 1,205 minuette wave (c) would reach 2.618 the length of minuette wave (a), and at 1,203 minor wave 2 would reach the 0.382 Fibonacci ratio of minor wave 1.
The final fifth wave of subminuette wave v may be unfolding as an ending contracting diagonal, a reasonably common structure. All the sub waves must subdivide as zigzags, and the fourth wave of micro wave 4 must overlap back into first wave price territory.
Once the final fifth wave upwards is complete, thereafter a new low below 1,142.82 would add some confidence to this wave count. It would still require a new low below 1,131.09 for full confidence in the downwards trend at primary degree.
At the hourly chart level the decrease in momentum would be expected. This hourly wave count fits better with MACD.
This analysis is published about 05:35 p.m. EST.