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An upwards breakout was again expected, but price remains range bound.

Summary: Look out for strong upwards movement from both Gold and GDX, which may happen during a price shock instigated by the release of Non Farm Payroll data during tomorrow’s session. The target is at 1,333 in the first instance. If this is wrong, it may not be high enough.

A new low below 1,244.72 now would indicate more downwards movement to the original target for this pullback at 1,230.

Trading advice is again given under the classic analysis section.

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 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.

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 looks complete.

Two wave counts are again provided today at the hourly chart level.

The first hourly wave count expects that minor wave 3 has begun. The alternate looks at the possibility that minor wave 2 will still continue lower.

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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It is possible that minor wave 2 is over as a completed expanded flat correction. Minute wave c would be 1.51 longer than 1.618 the length of minute wave a. Minute wave c ends slightly below minute wave a, so a truncation is avoided.

Minor wave 3 may only subdivide as an impulse. Gold’s third waves often exhibit swift and strong fifth wave extensions. Minor wave 3 may end with a blowoff top.

Within minor wave 3, minute waves i and ii may now be complete. The middle of a large and strong third wave up should begin to build momentum.

Minute wave iii may only subdivide as an impulse. Within minute wave iii, minuette wave (i) may be complete. Minuette wave (ii) may yet move a little lower but may not move beyond the start of minuette wave (i) below 1,244.72.

Minuette wave (ii) today looks like an incomplete double zigzag. It looks likely to move lower, and it may find strong support at the lower edge of the pink base channel drawn about minute waves i and ii. Lower degree second wave corrections usually find support at a base channel drawn about a first and second wave one or more degrees higher.

Minute wave iii should have the power to break through resistance at the upper edge of the channel. When it has done that, then upwards momentum may increase strongly. The upper edge of the channel may then provide support.

A target is provided for minor wave 3 to end. No target is provided for minute wave iii because minute wave iv should be expected to be very brief and shallow.

With what looks like a five up for minuette wave (i) and now choppy slow downwards movement for minuette wave (ii), it looks like this main wave count has a better fit today.


Gold Elliott Wave Chart Hourly 2017
Click chart to enlarge.

Within minor wave 2, it is possible that only minute wave b is over.

Minute wave b is longer than the common length of up to 1.38 times the length of minute wave a, but still within the allowable convention of up to 2 times the length of minute wave a.

If minute wave b has ended, it would subdivide as a regular flat correction.

Minute wave c may be unfolding as an ending diagonal. The downwards wave labelled minuette wave (i) will not fit well as an impulse, so it may be a zigzag. Within ending diagonals, all subwaves must subdivide as zigzags.

Minuette wave (ii) may not move beyond the start of minuette wave (i) above 1,261.00.

Any breach of 1,261 by any amount at any time frame would immediately invalidate this alternate hourly wave count.



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.

Minor wave B may not move beyond the start of minor wave A above 1,263.64.



Gold Weekly 2017
Click chart to enlarge. Chart courtesy of

The small real body and long upper wick for the third weekly candlestick completes a stalled candlestick pattern. “It indicates bulls strength has been at least temporarily exhausted. A stalled candlestick pattern should be used to liquidate or protect longs, but usually not to short. It is generally more consequential at higher price levels.” (Nison, “Japanese Candlestick Charting Techniques”, page 100).

Lighter volume for the last upwards week is also concerning for bulls.

On Balance Volume is very close to resistance, but not quite there yet.

This weekly chart offers slightly more support to the alternate hourly Elliott wave count than the main hourly Elliott wave count.


Gold Daily 2016
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Gold remains range bound with resistance about 1,260 and support about 1,240. During this range bound period, it is a downwards day that has strongest volume suggesting now a downwards breakout is more likely than upwards.

However, On Balance Volume has recently broken above the purple line, which offered resistance, giving a reasonable bullish signal. Now On Balance Volume has turned down to test support at this line and it should be expected to hold and halt the fall in price.

The upper yellow line on On Balance Volume is slightly adjusted today. It is providing resistance. On Balance Volume is now squeezed between support and resistance.

There is very strong resistance here for price to overcome. The signal from On Balance Volume will be given reasonable weight in this analysis. It supports the main Elliott wave count.

Trading advice:

Profitable long positions may have stops moved up to breakeven to eliminate risk. The larger trend is most likely still up and corrections offer an opportunity to join the trend. Always use a stop. In this case, it should be at breakeven or preferably just below 1,244.72 now. Do not invest more than 1-5% of equity on any one trade.

More cautious traders may still like to wait for a classic breakout before entering the new trend.



GDX Daily 2016
Click chart to enlarge. Chart courtesy of

The bottom line for GDX is that it remains range bound. Volume suggests an upwards breakout is still more likely than downwards, but not by much. While this technique works more often than it fails, it is not certain.

On Balance Volume for GDX also gives a bullish signal. The purple trend line on On Balance Volume is long held, not too steeply sloped, and has been tested five times before. It has good technical significance. This signal should be given reasonable weight. Expect it is now very likely that GDX will break out upwards.

Look out for a strong upwards movement from GDX. GDX looks a little more clearly bullish than Gold at this stage.

Nothing in this analysis rules out a downwards breakout. The balance of probability looks to be bullish, but it is still possible price may yet break downwards for both GDX and Gold. In technical analysis nothing is certain, which is why risk management is so important.

This analysis is published @ 07:11 p.m. EST.