Both bull and bear Elliott wave counts remain valid. Price has not yet told us which one is correct.
Summary: The bear wave count requires a very strong downwards move from here. A new low below 1,169.94 would provide some confidence that price is breaking out downwards, but to have a substantial level of confidence in the bear wave count a new low below 1,142.82 is required. The mid term target remains the same at 1,081, which may be met in five days or it may now need longer, maybe thirteen days. The bull wave count requires a new high above 1,200.03 for initial confidence.
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To see weekly charts for bull and bear wave counts go here.
Bear Wave Count
I would judge this bear wave count to be about 60% likely.
This wave count follows the bear weekly count which sees primary wave 5 within cycle wave a as incomplete. At 957 primary wave 5 would reach equality in length with primary wave 1.
1. Intermediate wave (1) (to the left of this chart) subdivides perfectly as a five wave impulse with good Fibonacci ratios in price and time. There is perfect alternation and proportion between minor waves 2 and 4.
2. Intermediate wave (2) is a very common expanded flat correction. This sees minor wave C an ending expanding diagonal which is more common than a leading expanding diagonal.
3. Minor wave B within the expanded flat subdivides perfectly as a zigzag.
4. Volume consistently supports the idea that the trend is currently down.
1. Intermediate wave (2) looks too big on the weekly chart.
2. Intermediate wave (2) has breached the channel from the weekly chart which contains cycle wave a.
3. Minute wave ii breaches a base channel about the first and second wave one degree higher, minor waves 1 and 2. It is deeper and longer lasting than normal for a low degree second wave within a third wave one and two degrees higher.
4. Within minor wave 1 down there is gross disproportion between minute waves iv and ii: minute wave iv is more than 13 times the duration of minute wave i, giving this downwards wave a three wave look.
This wave count now expects to see a strong increase in downwards momentum as a third wave unfolds. At 1,059 minor wave 3 would reach equality in length with minor wave 1, and both would be extended.
Within minor wave 3, if minute wave ii continues further as a double flat or combination then it may not move beyond the start of minute wave i above 1,224.35.
Draw a blue base channel about minor waves 1 and 2. Create a parallel copy and push it up to sit on the high of minute wave ii, then copy these trend lines over to the hourly chart. Look for upwards movement to find resistance at the blue trend lines.
Volume for Friday is slightly higher for an up day. Although volume is higher than the prior two down days, it is still not higher than the strong down day for 30th April, six days ago. This is a very small cause for concern with the bear wave count, but it is not clear enough to favour the bull wave count.
The bear wave count sees another first and second wave now complete. This gives a series of five overlapping first and second wave corrections. When third waves extend they do necessarily begin with a series of overlapping first and second waves, which convinces us that a third wave is not beginning right before it takes off. When this happens it is like a spring loaded with potential energy. When the energy is released the movement can be explosive.
Gold continues to make lower highs, although it is not making lower lows for the last few days.
Subminuette wave ii subdivides reasonably well as a three wave zigzag correcting to just above the 0.618 Fibonacci ratio. It is extremely likely to be over here.
A third parallel copy of the upper blue trend line from the daily chart shows where minuette wave (ii) and now subminuette wave ii have found resistance. I expect any further corrections to find resistance at this trend line.
Interestingly, minuette wave (iii) would reach 2.618 the length of minuette wave (i) at 1,081 and minute wave iii would reach 4.236 the length of minute wave i also at 1,081. This mid term target may be met in another five days if minute wave iii totals a Fibonacci thirteen days / sessions. It may be able to do this if the fifth wave within it is fast and strong, and the fourth wave corrections are less time consuming than these second wave corrections have been. But if it requires more time then the next Fibonacci number in the sequence is twenty one which would require a further thirteen days to the target.
Subminuette wave ii may not move beyond the start of subminuette wave i above 1,200.03.
I would have some further confidence with a new low below 1,169.94 in this bear wave count. It does still require a new low below 1,142.82 before a reasonable amount of confidence can be had in it.
Bull Wave Count
I would judge this bull wave count to be about 40% likely.
The bull wave count sees primary wave 5 and so cycle wave a a complete five wave impulse on the weekly chart. In order for members to judge for themselves I will list all points for and against for bull and bear wave counts.
1. The size of the upwards move labelled here intermediate wave (A) looks right for a new bull trend at the weekly chart level.
2. The downwards wave labelled intermediate wave (B) looks best as a three.
3. The small breach of the channel about cycle wave a on the weekly chart would be the first indication that cycle wave a is over and cycle wave b has begun.
1. Within intermediate wave (3) of primary wave 5 (now off to the left of this chart), to see this as a five wave impulse requires either gross disproportion and lack of alternation between minor waves 2 and 4 or a very rare running flat which does not subdivide well.
2. Intermediate wave (5) of primary wave 5 (now off to the left of the chart) has a count of seven which means either minor wave 3 or 5 looks like a three on the daily chart.
3. Expanding leading diagonals are are not very common (the contracting variety is more common).
Volume shows a small increase for an up day, but for volume to support the bull wave count it needs to show an increase beyond that for 30th April, six days ago. While up day volume is lower than 187.8K the bear wave count will be favoured.
Within cycle wave b primary wave A may be either a three or a five wave structure. So far within cycle wave b there is a 5-3 and an incomplete 5 up. This may be intermediate waves (A)-(B)-(C) for a zigzag for primary wave A, or may also be intermediate waves (1)-(2)-(3) for an impulse for primary wave A.
Intermediate wave (A) subdivides only as a five. I cannot see a solution where this movement subdivides as a three and meets all Elliott wave rules (with the sole exception of a very rare triple zigzag which does not look right). This means that intermediate wave (B) may not move beyond the start of intermediate wave (A) below 1,131.09. That is why 1,131.09 is final confirmation for the bear wave count at the daily and weekly chart level.
Intermediate wave (B) is a complete zigzag. Because intermediate wave (A) was a leading diagonal it is likely that intermediate wave (C) will subdivide as an impulse to exhibit structural alternation. If this intermediate wave up is intermediate wave (3) it may only subdivide as an impulse.
At 1,320 intermediate wave (C) would reach equality in length with intermediate wave (A), and would probably end at the upper edge of the maroon channel. At 1,429 intermediate wave (C) or (3) would reach 1.618 the length of intermediate wave (A) or (1). If this target is met it would most likely be by a third wave and intermediate wave (C) would most likely be subdividing as a five wave impulse.
It is possible that the intermediate degree movement up for the bull wave count is beginning with a leading diagonal in a first wave position for minor wave 1.
A leading diagonal must have second and fourth waves which subdivide as zigzags. The first, third and fifth waves are most commonly zigzags but sometimes they may be impulses.
Within diagonals the most common depth of the second and fourth waves is between 0.66 and 0.81. Minute wave ii is 0.67 of minute wave i.
Minute wave ii may not move beyond the start of minute wave i below 1,142.82.
I have tried to see if the upwards movement labelled subminuette wave 1 can subdivide as a five and it will not. It only fits as a three.
Minute wave iii within the larger leading diagonal for minor wave 1 (as on the daily chart) may be either a zigzag or an impulse. It is most likely to be a zigzag.
If this upwards movement is a three it may be subminuette wave i within an ending diagonal for minuette wave (c), and so minute wave iii is unfolding as a zigzag.
Within the ending diagonal of minuette wave (c) subminuette wave i is a complete zigzag and subminuette wave ii is incomplete. It is most likely to correct to between 0.66 to 0.81 of subminuette wave i between 1,184 to 1,182. So far it has reached a little lower than this and the structure is incomplete. Micro wave C is likely to make at least a slight new low below the end of micro wave A at 1,181.80 to avoid a truncation.
Subminuette wave ii may not move beyond the start of subminuette wave i below 1,178.97.
If 1,178.97 is breached then the bull wave count would see minuette wave (ii) continuing lower. The invalidation point for that is at 1,169.94.
If 1,169.94 is breached the bull wave count would further reduce in probability. It would only reduce substantially in probability with a new low below 1,142.82.
This analysis is published about 04:34 p.m. EST.