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I have a new alternate Elliott wave count for you.

Summary: If price makes a new low below 1,208.33 on Monday and remains below 1,235.16, then expect overall more downwards movement for another few days most likely to end about 1,131. This alternate is possible but has a very low probability. Low probability does not mean no probability.

New updates to this analysis are in bold.

Last published weekly chart is here.


Gold Elliott Wave Chart Daily 2016
Click chart to enlarge.

What if the main wave count is wrong? What if price moves lower on Monday? What structure could that be?

This is the best possibility I can see at this stage. And it does not have a very good look.

There are multiple structural possibilities for a second wave. The only structure it may not take is a triangle (although a triangle may be part of a combination). This leaves 17 structural possibilities.

If a triangle is accepted as labelled (and this does not have a good look), then intermediate wave (2) may still be subdividing as a single or double zigzag. A double zigzag has a slightly better look, although both will fit. Minor wave W will subdivide as either a zigzag or an impulse.

The problem with this wave count is minor wave X as a triangle does not have the right look. This part of the wave count looks very forced. This substantially reduces the probability of this wave count, but low probability is not no probability.

If the main wave count is invalidated with a new low below 1,208.33, then this may be an explanation.

At that stage, intermediate wave (2) may be expected to continue lower to reach the 0.618 Fibonacci ratio of intermediate wave (1) at 1,131.


Gold Elliott Wave Chart Hourly 2016
Click chart to enlarge.

Minor wave X is labelled as a running contracting triangle. The only thing that looks right about this structure is its adherence neatly to the triangle trend lines.

The breakout from triangles is usually swift. This part of the wave count also has the right look.

The upwards movement from Friday’s low is coming on declining volume. This supports this wave count and new lows in the short term. There was no support for that upwards movement from volume, so it is suspicious. That is concerning for the main wave count and one of the biggest reasons for considering this alternate.

Whether the next wave down is a zigzag for minor wave Y or an impulse for minor wave C, the rule for the B or 2nd wave is the same. It may not move beyond the start of minor wave Y or C above 1,235.16.

This analysis is published @ 06:26 p.m. EST on 3rd April, 2016.