Select Page

An inside day for Friday’s session leaves both Elliott wave counts valid. Classic technical analysis may assist to determine whether the main or alternate Elliott wave count is correct.

Summary: Use the pink channel on the hourly charts. A break below would indicate a downwards wave underway. If price touches the upper edge again, expect a reaction there. The target for this next wave down to end is at 1,164 – 1,160. A new low below 1,210.53 would add confidence in targets.

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 has a better fit for prior movement. To see the difference between this main wave count and the alternate below please refer to last historic analysis linked to above.

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.

At this stage, the degree of labelling within intermediate wave (2) is tentatively moved up one degree. Minor wave A is complete and now minor wave B may be complete. If this is correct, then minor wave C down should be relatively time consuming. Intermediate wave (2) at its end should be somewhat in proportion to intermediate wave (1), which lasted 30 days. Intermediate wave (2) is expected to last a Fibonacci 21 or 34 days.

Intermediate wave (2) is labelled as an incomplete expanded flat correction. These are very common structures. Within them their B waves make a new price extreme beyond the start of the A wave. B waves of expanded flats should exhibit clear and strong weakness.

The first in a series of second wave corrections for Gold’s new impulses is usually very deep. Intermediate wave (2) is expected to be at least 0.618 the depth of intermediate wave (1), and may be deeper. It may not move beyond the start of intermediate wave (1) below 1,123.08.

To label intermediate wave (2) complete as a very quick shallow zigzag at the low of minor wave A would be possible, but the probability is extremely low. It is much more likely that an expanded flat is unfolding.


Gold Elliott Wave Chart Hourly 2017
Click chart to enlarge.

Minor wave A is seen as a zigzag for both wave counts. The difference between the two is the structure of minute wave c within minor wave B.

There is no Fibonacci ratio between minute waves a and c.

The target is a small $4 zone calculated at two degrees. It assumes the most common Fibonacci ratio between minor waves A and C for an expanded flat.

A new low below the Elliott channel would add reasonable confidence to this wave count. Look out for price to breach the channel, then bounce up and retest the underside for resistance. If price behaves like that, it would offer a good entry to join a downwards trend.

A new low below 1,210.53 would invalidate the second hourly chart below and provide some confidence in a trend change. A new low below the start of minor wave A at 1,181.42 would add further confidence.


Gold Elliott Wave Chart Hourly 2017
Click chart to enlarge.

It is possible that Gold may yet see one more high before it turns.

Minor wave B is relabelled today as a possible double zigzag that would be incomplete. The downwards movement labelled minute wave x is too big to be a correction within the prior upwards wave labelled minuette wave (c); this is a separate wave.

Double zigzags are very common structures. The second zigzag in the double exists to deepen the correction when the first zigzag does not move price deep enough. To achieve this purpose X waves within double zigzags are normally relatively brief and shallow. Minute wave x fits this description. So far this looks like a normal double zigzag.

Within the zigzag of minute wave y, if minuette wave (b) continues lower, it may not move beyond the start of minuette wave (a) at 1,210.53.



Gold Elliott Wave Chart Daily 2017
Click chart to enlarge.

This alternate wave count expects that Gold is still within a bear market. Targets for new lows can be seen on weekly and monthly charts.

Within the bear market, a primary degree correction is underway.

Primary wave 2 is most likely to subdivide as a zigzag. Intermediate wave (A) is complete and a correction for intermediate wave (B) has begun.

Intermediate wave (B) may not move beyond the start of intermediate wave (A) below 1,123.08.

Primary wave 2 may not move beyond the start of primary wave 1 above 1,374.81.



Gold Weekly 2017
Click chart to enlarge. Chart courtesy of

The bearish engulfing candlestick pattern of last week has failed. Price has made a new high.

Since four weeks ago, volume is overall declining. Price is still finding strong resistance about 1,225.

On Balance Volume has bounced up off the yellow support line. Next resistance is some distance away at the purple line. Another breach of the yellow line would be a weak bearish signal.

RSI is not extreme and exhibits no divergence with price. There is plenty of room for this market to continue higher, or lower.

ADX is strongly declining, indicating a consolidation. The -DX line remains above the +DX line, so at this stage a downwards trend would be indicated if ADX turns upwards.


Gold Daily 2016
Click chart to enlarge. Chart courtesy of

Gold is range bound with resistance about 1,225 and support about 1,180. A breakout above 1,225 on a day with higher volume would be an upwards breakout. If that happens, then we may expect the upwards trend has resumed. A break below 1,180, preferably but not necessarily with stronger volume, would be a downwards breakout. If that happens, we may expect a deeper pullback or a downward trend is underway.

Next resistance is about 1,240. Next support is about 1,165.

On Balance Volume gave a small bullish signal with a bounce up from the yellow line. There is some divergence between the highs of 2nd of February and 24th of January: price made a higher high, but OBV made a lower high. This indicates some weakness.

The balance of volume for Friday’s session was upwards and volume was lighter. This supports the first hourly Elliott wave count.

The divergence noted with red lines on price and RSI supports the Elliott wave count. This is exactly what should be seen for B waves.

ATR remains flat indicating the market is trending. ADX is still slightly increasing, indicating an upwards trend that is not yet extreme. With price essentially moving sideways for the week, some suspicion may be had on ADX.

Stochastics exhibits divergence with price at the last high. This also supports the Elliott wave count.

Bollinger Bands are tightly contracted. If this is an upwards trend, as ADX suggests, then it looks tired. Bollinger Bands often contract towards the end of a trend as volatility declines.

The longer term 200 day moving average is still declining, indicating the longer term trend is still down.

The mid term moving average is now slightly increasing and this week the short term average crossed above it. This indicates a possible change to an upwards trend.

Bullish moving averages and ADX disagree with the Elliott wave count.


GDX Daily 2017
Click chart to enlarge. Chart courtesy of

GDX is finding resistance mostly at the blue sloping line, with one overshoot.

The very long upper wick on the 1st of February’s candlestick is bearish. Now followed by a very small doji this puts the expectation of a trend from up to neutral. Another small range day for Friday comes with overall upwards movement but very light volume. There is not support for upwards movement for price on Friday. This is bearish.

Volume is declining as price is rising overall. This is not normal for a healthy and sustainable trend.

ADX still indicates an upwards trend is in place, which is not yet extreme.

ATR is overall flat.

On Balance Volume continues to find support at the yellow line. It has not yet given any signal.

Divergence noted yesterday between price and RSI has now disappeared. RSI is not yet extreme. There is room for price to rise further.

Stochastics exhibits strong divergence. This is bearish.

Bollinger Bands have been contracting since the 17th of January. This is normal for the end of a trend. At the end of this week, Bollinger Bands may be beginning to expand.

There is some concern here if expecting GDX is still in an upwards trend. The apparent breakout was quickly reversed. GDX continues to find resistance about 25.00 and support about 22.75. A breakout above or below this range is required for any confidence in the next direction for GDX.

This analysis is published @ 07:10 p.m. EST.