This Elliott wave count expects Gold is within a grand super cycle correction.
HISTORIC ANALYSIS: 1833 – 2016
Data used for the chart above is averages for the year. It does not include high / low. Note the chart scale is a logarithmic scale. Data on this chart is only from 1833 to 2016. Price action from the all time high in 2011 is analysed on the monthly chart below, and in more regular weekly chart analysis.
This wave count expects Gold is within a grand super cycle fourth wave correction. Super cycle wave IV may not move into grand super cycle wave I price territory below 21.73.
Grand super cycle wave III lasted from 1931 to 2012, 81 years. This is about one generation, so this duration looks about right.
Ratios within grand super cycle wave III are: super cycle wave (I) (17.81 in length) has no Fibonacci ratio to super cycle wave (III) (581.17 in length), and super cycle wave (V) (1,397.94 in length) is 123.56 short of 2.618 the length of super cycle wave (III), an 8.8% variation (I consider less than 10% an acceptable ratio).
Within grand super cycle wave III, super cycle wave (I) lasted a Fibonacci 5 years, super cycle wave (II) lasted a Fibonacci 13 years, super cycle wave (III) lasted 31 years, super cycle wave (IV) lasted a Fibonacci 21 years, and super cycle wave (V) lasted 11 years.
Ratios within super cycle wave (III) are: cycle wave III (125.05 in length) has no adequate Fibonacci ratio cycle wave I (9.70 in length), and cycle wave V (487.72 in length) is 41.99 short of 4.236 the length of cycle wave III, an 8.6% variation.
Within super cycle wave (III), cycle wave I lasted twenty years (just one short of a Fibonacci twenty-one), cycle wave II lasted a Fibonacci one year, cycle wave III lasted a Fibonacci five years, cycle wave IV lasted a Fibonacci one year, and cycle wave V lasted four years.
The cyan trend lines are a best fit only. This movement does not fit neatly into an Elliott channel, but then Gold’s impulses often do not due to their curved shape forced by a strong fifth wave.
If grand super cycle wave IV ends within the price territory of the fourth wave of one lesser degree, then it would reach down as low as 612.56 to 271.04. It would be most likely to end close to (a bit above) the end of the fourth wave of one lesser degree, so just above 271.04. This is most typical of fourth waves.
A word about durations of corrective waves. Notice that corrective waves are usually quicker than the actionary waves they correct. Grand Super Cycle wave II lasted only eight years, but it corrected Grand Super Cycle wave I which may have lasted at least 50 years (from the Depression of the 1870’s to the early 1920’s).
Grand Super Cycle wave III lasted 81 years, but Grand Super Cycle wave IV does not have to be as long in duration. It may be over within a few years.
The guidelines given for durations of waves in this chart are rough guidelines only. Flexibility should be applied. Not only are corrective waves quicker than the actionary waves they correct, but when actionary waves extend in price they also extend in time pushing out these expectations, or for non extended waves compressing expectations.
MONTHLY WAVE COUNT
All monthly charts are always on a semi-log scale.
A double zigzag downwards is complete within Grand Super Cycle wave IV. This would be very unlikely to be the entirety of Grand Super Cycle wave IV, because it is far too brief and shallow for a wave of this degree. It would most likely be Super Cycle wave (a).
Grand Super Cycle wave II was most likely a relatively quick zigzag lasting a Fibonacci eight years. The earliest reasonable expectation for Grand Super Cycle wave IV may be for it to total a Fibonacci thirteen years, but it may also be longer lasting, possibly a Fibonacci twenty one years.
Grand Super Cycle wave IV would most likely exhibit alternation with Grand Super Cycle wave II, so it is unlikely to be a zigzag. The first move down within it subdivides as a three (a double zigzag) very well and will not fit as a five meeting all Elliott wave rules.*
Because the first movement down is a multiple, a larger multiple corrective structure may be eliminated for Grand Super Cycle wave IV. This is because the maximum number of corrective structures within a multiple is three. To label multiples within multiples increases the maximum beyond three, violating the rule.
With the first movement down being a three wave structure, a triangle or flat correction is indicated as most likely for Grand Super Cycle wave IV. Within both of these types of structures, Super Cycle wave (b) may make a new price extreme beyond the start of Super Cycle wave (a) at 1,920.18, as in an expanded flat or running triangle.
Within a flat correction, Super Cycle wave (b) must make a minimum 0.9 correction of Super Cycle wave (a) at 1,832.79. The normal range for Super Cycle wave (b) of a flat correction would be between 1 to 1.38 the length of Super Cycle wave (a) at 1,920.18 to 2,252.27,
Within a triangle, Super Cycle wave (b) has no minimum requirement. It may make a new high above the start of Super Cycle wave (a) at 1,920.18 as in a running triangle.
Super Cycle wave (b) is likely to be very deep. The most likely structure to achieve a very deep correction is a zigzag or a zigzag multiple. An expanded flat may also achieve this.
There are more than 23 possible corrective structures that Super Cycle wave (b) may take. At this stage, it is possible to say which one is most likely, but not which one will unfold. Flexibility is essential while this structure unfolds upwards.
A support line is drawn across the lows of December 2001 to April 2003 and extended out (cyan). This trend line has offered support and resistance, so it should do so again.
*Edit: Comment added: the * in the analysis above needs explanation. I am aware that other analysts see this big wave down as a completed five wave structure. Their wave counts see an ending diagonal beginning on 10th July 2014. Such a wave count violates the rules for wave lengths of contracting diagonals, the third wave within the diagonal is too long, it is longer than the first wave. I will not rely on nor publish any wave count which violates any Elliott wave rule.
This analysis is published about 02:30 a.m. EST.