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The targets were not met before price turned and moved higher. Downwards targets for the correction to end were inadequate.

Summary: The correction looks like it is over. A short term target for a strong third wave up is at 1,515.

New updates to this analysis are in bold.

Last weekly chart can be found here.

Grand SuperCycle analysis is here.


Gold Elliott Wave Chart Daily 2016
Click chart to enlarge.

There will be just one wave count today.

At this stage, this wave count has the best look and the best fit at the hourly chart level. There are no truncations and no rare structures in this wave count, so it has a reasonable probability. Yesterday’s first preferred wave count expects exactly the same direction next, but has now decreased in probability due to a reasonable sized truncation, so it will no longer be published.

Intermediate wave (2) is a complete expanded flat correction. Price from the low labelled intermediate wave (2) has now moved too far upwards to be reasonably considered a continuation of intermediate wave (2). Intermediate wave (3) is very likely to have begun and would reach 1.618 the length of intermediate wave (1) at 1,582.

Intermediate wave (3) may only subdivide as an impulse.

So far minor waves 1 and 2 may be complete within intermediate wave (3). The middle of intermediate wave (3) may have begun and may also only subdivide as an impulse.

Within minor wave 3, the end of minute wave i is today moved up to the last high. This fits on the hourly chart although it looks odd here on the daily chart. There was a small fourth wave correction up at the end of minute wave i and it subdivides on the hourly chart as an impulse. Minute wave ii may be a complete zigzag, also subdividing as a zigzag on the hourly chart. If minute wave ii is over, it would be 0.50 the depth of minute wave i.

No second wave correction may move beyond the start of its first wave below 1,310.84 within minute wave iii.

At 1,437 minor wave 3 would reach 1.618 the length of minor wave 1. If price keeps going upwards through this first target, or if it gets there and the structure is incomplete, then the next target would be at 1,552 where minor wave 3 would reach 2.618 the length of minor wave 1.


Gold Elliott Wave Chart Hourly 2016
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The triangle may have been a B wave, not a fourth wave. Because of the spike labelled subminuette wave c within the triangle, it cannot end there. The triangle may only have ended at the high of 1,333.60. With price since having made a slight new high above this point, upwards movement may not be a second wave correction within minuette wave (c), so minuette wave (c) has to be over.

So far within the new upwards movement a five wave structure upwards looks to be complete. A three wave correction downwards would be likely to follow it.

With price now close to the middle of a third wave at three degrees, the strong upwards pull may force minuette wave (ii) to be more shallow than a second wave is normally. The 0.382 Fibonacci ratio may be a reasonable expectation in this instance for it to end. If price moves below that point, then the 0.618 Fibonacci ratio would be the next reasonable expectation.

At 1,515 minute wave iii would reach 1.618 the length of minute wave i. This target fits only with the second higher target for minor wave 3 on the daily chart.

Minute wave iii should have support from rising volume and it should exhibit stronger momentum than minute wave i.

Minor wave 1 lasted a Fibonacci thirteen days. Minute wave i lasted a Fibonacci eight days. Minute wave iii may be expected to last longer, about a Fibonacci thirteen or maybe twenty one days.



Gold Weekly 2016
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Last weekly candlestick completes a bearish engulfing candlestick pattern with higher volume. This is a strong bearish signal and strongly supports the wave count in expecting more downwards movement. If targets are wrong, they may be too high.

On Balance Volume has come down to find support at the upper purple trend line. This may offer some support. If OBV moves up and away from this line this week, it would be a reasonable bullish signal. A break below this line would be a reasonable bearish signal. The next line to offer support is not too far away but would still allow for a reasonable fall in price.


Gold Daily 2016
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An upwards day comes with an increase in volume for the first time in several days. There was support today for the rise in price, so it is not suspicious. This supports the Elliott wave count.

Price did not reach down to support at the horizontal line at 1,300 and Stochastics did not quite manage to reach oversold, but it still looks like the correction is over, falling a little short of expectations.

On Balance Volume may be beginning to break above the short purple line. One more day of upwards movement would make this break clearer. That would provide a weak bullish signal from OBV.

ADX has returned from extreme. It is now below 30. There is plenty of room for price to rise again.

ADX today is still declining, indicating the market is not trending. ATR is still overall flat to declining, in agreement with ADX. The market has been correcting now for 11 days and both of these indicators are based on 14 day averages, so they are lagging. If the black ADX line turns upwards and / or ATR turns upwards, then a resumption of the upwards trend would be indicated.

RSI is neutral. There is plenty of room for price to rise or fall from here.

Overall, with volume and OBV both slightly bullish, it looks reasonably likely that the correction has ended and the upwards trend may now resume.

This analysis is published @ 05:38 p.m. EST.