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A small inside day completes and fits expectations for a correction to continue.

Summary: The correction is still most likely incomplete. It may continue further for yet another one to few days. Thereafter, the upwards trend should resume. The target for long positions remains at this stage at 1,333. If this is wrong, it may not be high enough.

New updates to this analysis are in bold.

Grand SuperCycle analysis is here.

Last monthly and weekly charts are here.



Gold Elliott Wave Chart Daily 2017
Click chart to enlarge.

This daily chart will suffice for both weekly charts.

Upwards movement at primary degree 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. It is most likely a third wave because cycle wave a is most likely to subdivide as an impulse.

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), minor waves 1 and 2 are now complete. Minor wave 3 looks to have begun. Within minor wave 3, the middle portion for minute wave iii may now be complete. Minute wave iv may not move into minute wave i price territory below 1,261.00.

Minute wave v is expected to be very strong, possibly ending with a blow off top.

A cyan trend line is added to all charts. Draw it from the high in October 2012 to the high in July 2016. This line has been tested five times. Price is finding resistance at the cyan trend line now. If price can break through resistance here after some consolidation, then that may release energy to the upside for the end of minor wave 3.


Gold Elliott Wave Chart Daily 2017
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This chart steps back to see all movement since the important low on the 3rd of December, 2015.

To see how this fits into the bigger picture, please see the last historic analysis linked to at the start of this analysis.

The first upwards movement labelled primary wave 1 fits well as a five wave impulse. Primary wave 2 fits as a zigzag. It would be difficult to see the downwards wave of primary wave 2 as an impulse because that would require ignoring what looks very much like a triangle at its start (labelled intermediate wave (B) ). To see this as an impulse that movement would need to be a second wave correction, but second waves do not subdivide as triangles.

Primary wave 3 should have begun. Within it intermediate waves (1) and (2) should be complete. Intermediate wave (2) is a very common expanded flat correction.

My only concern at this stage is the labelling of minute wave iii as complete. It is possible that the middle portion of this third wave at three degrees has passed, if the next waves up for minute wave v and minor wave 5 are both very long and strong extensions.

It may also be possible that the middle of the big third wave has not passed and the degree of labelling within minor wave 3 needs to be moved down one degree. If minute wave ii is yet to unfold, it may not move beyond the start of minute wave i below 1,240.24.


Gold Elliott Wave Chart Hourly 2017
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Minute wave ii was a deep 0.79 double zigzag, which lasted 25 hours, and on the daily chart it shows as only one session.

Given the guideline of alternation, minute wave iv may be expected to most likely be a flat, combination or triangle. All of these structures may include a new high above its start at 1,294.96 as part of the correction. A new high does not indicate minute wave iv is over.

Combinations, flats and triangles are all usually more longer lasting structures than zigzags.

At this stage, a flat correction for minute wave iv may be ruled out because there is no upwards wave within it that has retraced a minimum 0.9 length of any downwards wave within it. The minimum length for minuette wave (b) within a flat correction for minute wave iv has not been met.

That leaves two possibilities. This first hourly chart looks at a possible combination for minute wave iv. The second possibility, that of a triangle, was published yesterday but will no longer be published because it does not have the right look. Although it could technically be said to be possible, the probability is way too low at this time.

If minute wave iv is a combination, then the first structure within it labelled minuette wave (w) may be a complete zigzag.

The two structures in the double may be joined by a complete three in the opposite direction labelled minuette wave (x), which subdivides as an expanded flat correction.

Minuette wave (y) may have begun. It may be either a flat or a triangle.

At this stage, it looks like it may be continuing further as a flat correction. Within the flat correction, subminuette wave b must retrace a minimum 0.9 length of subminuette wave a. Subminuette wave c would then be very likely to end at least slightly below the end of subminuette wave a at 1,276.96 to avoid a truncation and a very rare running flat.

If minuette wave (y) is a flat correction, then at its end it will have to break below the parallel copy of the best fit channel, copied over from the daily chart. Fourth waves are not always neatly contained within channels.

It is also possible that minuette wave (y) may yet unfold sideways as a triangle and remain all or almost all within the best fit channel.

Minute wave iv may not move into minute wave i price territory below 1,261.00.



Gold Weekly 2017
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The relatively long upper wicks of the last two weekly candlesticks are a little bearish. The increase in volume last week is bullish.

The purple trend line on On Balance Volume has been carefully drawn to be as conservative as possible, sitting along the prior two highs. This trend line has a very shallow slope and is reasonably long held. It has only been tested twice before. It has some reasonable technical significance. Last week it is slightly breached offering a reasonable bullish signal. However, for the signal to have more weight it needs a clearer breach.


Gold Daily 2016
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I do not have confidence in the data from StockCharts for the daily candlestick for the 12th of April. As the session ended, I did not see a spike down to 1,278, which is their close, and creates the long upper wick on their candlestick.

It is very typical to see price curve around and test prior support or resistance after a breakout from a consolidation. This small pullback looks so far like a typical retest.

This does work more often than it doesn’t, but sometimes it does not work: price can return back into the consolidation area, as seen yesterday with GDX. Nothing in technical analysis is 100% certain, which is why risk management is so important. This is an exercise based upon probability, not certainty.

The long lower wicks of the last three daily candlesticks are bullish.

The decline in volume for the last two days looks like these candlesticks are part of a pullback and not necessarily a new trend.

On Balance Volume should be given reasonable weight in this analysis.

It is of slight concern today that ADX is nearing extreme. But it is not there yet.

It is not a concern that Stochastics is still overbought. This oscillator may remain extreme for long periods of time during Gold’s trends.


I have left my stop on my long position at 1,270.89. If price comes down again to the lower trend line, it may present another opportunity to add to long positions. Stops for new long positions may also be set at 1,270.89, but there is a risk here that a whipsaw may close out longs only to see price move higher. Alternatively, set stops just below 1,261 for new long positions here, and reduce position size to keep risk from 1-5% of equity.

Profit targets may be set at 1,333 in the first instance.

As always, risk management is the single most important aspect of trading. Take it seriously. My two Golden Rules are:

1. Always use a stop.

2. Invest only 1-5% of equity on any one trade.



GDX Daily 2016
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Price is back within the prior consolidation zone. This zone is now widened. There is some distance to go before price may find support about 22.50.

On Balance Volume may halt a rise in price here by providing resistance. If OBV breaks back above the purple line, then the prior bearish signal will be negated.

Overall, this chart is now neutral to slightly bearish.


Gold Daily 2016
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This study of a third wave will be left in daily analysis until the current third wave is either proven to be wrong (invalidated) or it is complete.

This third wave spans 59 trading days.

It was not until the 40th day that the overlapping ended and the third wave took off strongly.

The middle of the third wave is the end of minute wave iii, which ended in a blow off top.

There is excellent alternation between second and fourth wave corrections.

This third wave began with a series of five overlapping first and second waves (if the hourly chart were to be added, it would be seven) before momentum really builds and the overlapping ends.

The fifth wave of minuette wave (v) is the strongest portion.

This third wave curves upwards. This is typical of Gold’s strong impulses. They begin slowly, accelerate towards the middle, and explode at the end. They do not fit neatly into channels. In this instance, the gold coloured curve was used.

Gold Daily 2016
Click chart to enlarge. Chart courtesy of

This trend began after a long consolidation period of which the upper edge is bound by the blue trend line. After the breakout above the blue trend line, price curved back down to test support at the line before moving up and away.

RSI reaches overbought while price continues higher for another five days and RSI reaches above 85. The point in time where RSI reaches overbought is prior to the strongest upwards movement.

ADX reached above 35 on the 9th of February, but price continued higher for another two days.

The lesson to be learned here: look for RSI to be extreme and ADX to be extreme at the same time, then look for a blow off top. Only then expect that the middle of a big third wave is most likely over.

The end of this big third wave only came after the blow off top was followed by shallow consolidation, and more highs. At its end RSI exhibited strong divergence with price and On Balance Volume gave a bearish signal.

Third waves require patience at their start and patience at their ends.

This analysis is published @ 07:54 p.m. EST.