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Downwards movement was expected to start the new trading week, but this is not what happened.

Summary: Resistance on On Balance Volume and the 200 day moving average may be enough to turn price here down. In the short term, a new low below 1,252.75 would add a little confidence in a pullback continuing lower. The target is at 1,230.

If price makes a new high above 1,264.46, then the idea of a correction already underway will be discarded based upon a very low probability.

New updates to this analysis are in bold.

Last weekly charts are here and the last video on weekly wave counts is here.

Grand SuperCycle analysis is here.



Gold Elliott Wave Chart Daily 2017
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This daily chart will suffice for both weekly charts.

Upwards movement is either a third wave (first weekly chart) to unfold as an impulse, or a Y wave (second weekly chart) to unfold as a zigzag. If upwards movement is a zigzag for primary wave Y, then it would be labelled intermediate waves (A) – (B) and now (C) to unfold.

Intermediate wave (1) or (A) is a complete five wave impulse lasting 39 days. Intermediate wave (2) or (B) looks like an expanded flat, which is a very common structure.

So far, within intermediate wave (3) or (C), the first wave up for minor wave 1 may be complete. Minor wave 2 may unfold lower. Minor wave 2 may not be a very deep correction because the strong upwards pull of a big third wave may force it to be more shallow than otherwise. However, if it is relatively deep, it may find support at the lower edge of the base channel and may offer another opportunity to join the upwards trend.

Minor wave 2 may not move beyond the start of minor wave 1 below 1,195.22.


Gold Elliott Wave Chart Hourly 2017
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Almost all of minor wave 1 fits neatly within the Elliott channel (pink). The breach of the channel by downwards movement labelled minute wave a indicates minor wave 1 was over and minor wave 2 should be underway.

Minor wave 2 may be any corrective structure except a triangle. At this stage, it looks like it may be unfolding as an expanded flat correction, which are very common structures. Within minor wave 2, minute wave b is now a little longer than the common length of minute wave a, but is less than twice the length of minute wave a. If upwards movement continues above 1,264.46, then the idea of an expanded flat continuing should be discarded based upon a very low probability.

A new low short term below 1,252.75 would invalidate the alternate hourly wave count below and provide a little confidence in this main wave count.

The target for minute wave C is calculated at two degrees and both yield exactly the same price point. This has a reasonable probability.

Minor wave 1 lasted 9 days, 1 longer than a Fibonacci 8. So far minor wave 2 has lasted 2 days. If it continues for 3 more, it may total a Fibonacci 5, and that would give the wave count good proportions and the right look.


Gold Elliott Wave Chart Hourly 2017
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What if minor wave 1 is not over and today’s upwards movement is an extension of minute wave v within it?

If minute wave v is extending, then the middle of it may have ended at today’s high. Minuette wave (iv) may not move back into minuette wave (i) price territory below 1,252.75.

The breach of the Elliott channel gives this wave count the wrong look. Fifth waves should not breach channels like this.

There is now double bearish divergence at highs between price and MACD at the hourly chart level. This indicates weakness that may be seen for either wave count. It does not indicate which wave count is more likely, only that upwards momentum is weakening.



Gold Elliott Wave Chart Daily 2017
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This alternate wave count is in response to queries from members.

Fibonacci ratios are noted on both daily charts, so that members may compare the main and alternate wave counts. This alternate wave count has slightly better Fibonacci ratios. This gives this wave count a reasonable probability. Due mostly to volume, this wave count is judged to have a lower probability than the main wave count.

At this stage, this wave count would be considered confirmed if price makes a new low below 1,195.22. At that stage, the target for intermediate wave (2) or (B) to end would be the 0.618 Fibonacci ratio of intermediate wave (1) or (A) at 1,175.

At the hourly chart level, this alternate wave count would now have to see the structure differently from the main wave count. Minor wave B must be a zigzag; it cannot be seen as an impulse. This is problematic because the upwards movement looks very strongly like a five on the hourly chart. This wave count would be forced now. The probability of it has further reduced.



Gold Weekly 2017
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Last week saw price move higher with a small increase in volume. Overall, the rise in price has some support from volume and this supports the main Elliott wave count, which saw it as the end of a first wave up.

On Balance Volume is not close to resistance, so it gives no signal.

ADX has now been pulled right down from extreme. There is now room again for a longer term trend to develop.


Gold Daily 2016
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The long upper wick on today’s candlestick is bearish. Price should be expected to find some resistance here at the 200 day moving average.

While volume rose today with rising price, volume remains relatively light so far for the last two upwards days. Volume is slightly bullish.

On Balance Volume at resistance should be given reasonable weight. This often works well with trend lines.

Single divergence between price and Stochastics while Stochastics is overbought, flat ATR, and steady Bollinger Bands support the main hourly Elliott wave count.



GDX Daily 2016
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GDX remains range bound. Today moved price higher and the balance of volume was up (this shows some increase).

During the range bound period, it remains an upwards day which has strongest volume suggesting an upwards breakout is more likely than downwards.

This analysis is published @ 07:02 p.m. EST.