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Gold is still range bound.

On Balance Volume today is giving a signal for the next direction for Gold.

Summary: Gold has now been range bound for ten sessions. Resistance is at 1,245 and support is at 1,220. A downwards breakout still looks more likely than upwards and with a bearish signal from On Balance Volume today a little more confidence is had in this view.

If price breaks below 1,217.05, the target is at 1,148. If price breaks above 1,244.49, the target is at 1,452.

New updates to this analysis are in bold.

Last monthly and weekly charts are here. Last historic analysis video is here.

Grand SuperCycle analysis is here.



Gold Elliott Wave Chart Daily 2017
Click chart to enlarge.

This main wave count expects Gold has had a primary degree trend change in December 2016. The new upwards wave is either a primary degree third wave, or a primary degree zigzag to complete a double zigzag.

Intermediate wave (1) is an impulse that lasted 23 days, two longer than a Fibonacci 21. Intermediate wave (2) may be unfolding as a very common expanded flat correction.

Within intermediate wave (2), minor wave A fits best as a regular flat and minor wave B is a zigzag. Minor wave B is longer than the common length of 1 to 1.38 times A, but within the allowable convention of up to two times the length of A.

The appropriate target for minor wave C is 2.618 the length of minor wave A.

So far intermediate wave (2) has lasted 26 sessions. Minor waves A and B have lasted a Fibonacci eight sessions each. If intermediate wave (2) exhibits a Fibonacci duration, it may be a total 34 sessions. At this stage, it looks like a Fibonacci 34 may now be too brief. The next Fibonacci number in the sequence is 55. Corrections are often more time consuming than the impulses they correct, so this is entirely possible and would still have the right look.

Alternatively, intermediate wave (2) may not exhibit a Fibonacci duration.

The alternate daily and hourly charts below will look at the possibility that intermediate wave (2) is not continuing, that it may have been over already.

The longer term targets for primary waves 3 or Y may be met in a total Fibonacci 34 weeks from their start. So far this upwards trend has lasted nine weeks.

It is my judgement today that this main wave count is about 70% likely, a slight increase from yesterday due to volume analysis.


Gold Elliott Wave Chart Hourly 2017
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Minute wave ii may be a close to completion double combination. These are very common structures, and it is common for second waves to be very deep. Particularly the first in a series of second waves within an impulse.

The purpose of double combinations is to take up time and move price sideways. To achieve this purpose the second structure in the double normally ends close to the same level as the first.

The structure within minuette wave (y) is changed from the hourly chart that was posted in last comments. It will fit better if it is not quite complete. Within this zigzag, the wave of subminuette wave b fits neatly as an expanded flat. Subminuette wave c may be an incomplete five wave impulse with the final fifth wave up to find resistance at the yellow trend line, which is copied over from the daily chart.

Within subminuette wave c, the small correction of micro wave 4 may not move into micro wave 1 price territory below 1,234.31. A new low below this point (before a new high) would indicate the structure of subminuette wave c is complete, which would also indicate the entire correction of minute wave ii would be more likely complete.

So far subminuette wave c has moved a little above the end of subminuette wave a at 1,238.74, so it has avoided a truncation. It is possible that it could be over already.

A new low below 1,217.05 would add substantial confidence in this wave count. Prior to that a new low now below 1,231.82 would add some reasonable confidence at this stage.

The prior upwards wave labelled minor wave B can be seen as a zigzag for this main wave count. The subdivision has a much better fit for this idea increasing the probability of this main wave count over the alternate below. To see the subdivision within minor wave B see analysis from the 9th of February.



Gold Elliott Wave Chart Daily 2017
Click chart to enlarge.

This alternate wave count is an alternate idea to the main wave count. What if intermediate wave (2) was over as a brief shallow regular flat correction? It would have lasted just 8 days compared to intermediate wave (1) at 23 days. It would have been only 0.388 the depth of intermediate wave (1) and this is more shallow than normal for an intermediate degree second wave.

The black channel is a base channel about intermediate waves (1) and (2). Along the way up, lower degree second wave corrections should find support at the lower edge of the base channel. For this reason minor wave 2 looks most likely to be over now.

Within minor wave 3, no second wave correction may move beyond the start of its first wave below 1,217.05.

Minor wave 2 would have lasted a Fibonacci five sessions compared to minor wave 1 at a Fibonacci eight sessions. This proportion looks right.

This alternate wave count now expects that the last five sessions have been the start of a third wave up at two degrees. Now a third wave up should begin here at three degrees. Price behaviour at this stage does not support this wave count. It could be redeemed if a classic upwards breakout occurs such as a strong upwards day to close above resistance at 1,245 on high volume.

The long lower wicks on four of the recent sessions does look bullish. There is some support for this wave count.

It is my judgement today that this wave count has about a 30% probability.


Gold Elliott Wave Chart Daily 2017
Click chart to enlarge.

Minute wave ii now fits perfectly as a zigzag, ending almost right on the 0.618 Fibonacci ratio of minute wave i.

Now minuette wave (ii) also fits neatly as an expanded flat, which are very common structures. It is a 0.567 depth of minuette wave (i), so it is relatively deep.

A third wave up now at four degrees should begin. If this wave count is correct, then the next session should see a strong upwards breakout. The fact that this expected strong movement continues to be delayed is concerning for this wave count.

If this wave count is confirmed with a new high above 1,244.89, then it would be the only wave count. At that stage, expect price to keep rising and corrections to become more brief and shallow, and Gold to trend strongly.

If this wave count is confirmed, then members would be advised to be flexible, to switch quickly from bear to bull and trade accordingly.

Please always remember my two Golden Rules for traders:

1. Always use a stop.

2. Never invest more than 1-5% of equity on any one trade.

Within minor wave 1 upwards (now seen only on the daily chart), the structure must be seen as as five wave impulse. This can fit but requires a very rare running flat with a substantially truncated C wave. To see the subdivisions as an impulse for minor wave 1 see hourly charts in analysis for the 9th of February.



Gold Weekly 2017
Click chart to enlarge. Chart courtesy of

Price for last week made a lower high and lower low, the definition of downwards movement. However, the candlestick closed green and the balance of volume during the week was upwards. A decline in volume for upwards movement during the week is bearish. The long lower wick and green colour of the candlestick is bullish.

Resistance for On Balance Volume is some distance away as is support. The last break above resistance at the yellow line and backtest of support is bullish.

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

ADX is still declining after reaching extreme during the last upwards trend. The +DX and -DX lines have now crossed. If ADX turns up here, then an upwards trend would be indicated.


Gold Daily 2016
Click chart to enlarge. Chart courtesy of

Gold is range bound now with resistance about 1,245 and support about 1,220, delineated now by blue trend lines. The bottom line is we should now wait for a breakout and then join the next trend.

This session moved price lower with a lower high and a lower low, and the balance of volume was downwards, so it is read as a downwards session although it closed green.

During this range bound period, it is the day of the 21st of February that has strongest volume suggesting a downwards breakout is more likely than upwards. This technique does not always work, but for Gold it does work more often than it does not. It points to probability, not certainty.

On Balance Volume may be breaking below support. When OBV breaks trend lines while price is range bound, it may indicate the next direction for price. On Balance Volume usually works well with trend lines; again, this points to a balance of probability, not certainty, but this technique works more often than it fails.



GDX Daily 2016
Click chart to enlarge. Chart courtesy of

It looks like GDX is breaking out of a small consolidation downwards on a day with high volume. The long lower wicks on the last two daily candlesticks does give some cause for concern here though.

On Balance Volume for GDX gave a strong bearish signal with a break below the upwards sloping yellow line.

This analysis is published @ 07:06 p.m. EST.