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Downwards movement continues a little lower, which was not what was expected for Tuesday’s session.

Summary: A second wave bounce may end about 1,281. Thereafter, a third wave down may unfold for a few days. Always use a stop, which should be just above the last high at 1,295.65. Do not invest more than 1-5% of equity on any one trade.

New updates to this analysis are in bold.

Last monthly charts and alternate weekly charts are here, video is here.

Grand SuperCycle analysis is here.


Gold Elliott Wave Chart Weekly I 2017
Click chart to enlarge.

At this stage, all weekly charts published expect more upwards movement. Because there is no difference in the direction expected, only this one more likely weekly chart will be published on a daily basis.

The Magee bear market trend line is added to the weekly charts. This cyan line is drawn from the all time high for Gold on the 6th of September, 2011, to the first major swing high within the following bear market on the 5th of October, 2012. This line should provide strong resistance.

At this stage, a triangle still looks most likely and has the best fit for cycle wave b.

Within a triangle, one sub-wave should be a more complicated multiple, which may be primary wave C. Primary wave C may not move beyond the end of primary wave A above 1,374.91. This invalidation point is black and white.

At this stage, it looks like primary wave C is now complete at the hourly and daily chart level. However, at the weekly chart level, it looks possible it may continue higher. This possibility must be acknowledged while price remains above 1,214.81. Within intermediate wave (Y), minor wave B may not move beyond the start of minor wave A.

Primary wave D of a contracting triangle may not move beyond the end of primary wave B below 1,123.08. Contracting triangles are the most common variety.

Primary wave D of a barrier triangle should end about the same level as primary wave B at 1,123.08, so that the B-D trend line remains essentially flat. This involves some subjectivity; price may move slightly below 1,123.08 and the triangle wave count may remain valid. This is the only Elliott wave rule which is not black and white.

Primary wave C may end when price comes up to touch the Magee trend line.


Gold Elliott Wave Chart Daily 2017
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Intermediate wave (Y) may now be a complete zigzag if it is accepted that a triangle completed in the position labelled minor wave B. This has a perfect fit on the hourly chart. So that all subdivisions can be seen, a 2 hourly chart is provided this week.

The best fit channel about intermediate wave (Y) is now properly breached with two full daily candlesticks below and not touching the lower trend line. This adds a little confidence that a high may be in place.

It is very typical price behaviour to curve back and retest support or resistance after breaking through. This does not always happen, but it happens often enough to be an excellent trade set up. If price now curves upwards, expect it is very likely to come up to touch or get very close to the lower edge of the best fit channel. If price does behave like that, then it would offer a good entry point to go short. Stops should be set just above the last swing high at 1,295.65.

A new low below 1,214.81 could not be minor wave B within intermediate wave (Y) and would provide strong confirmation that intermediate wave (Y) is over. A new low below 1,214.81 would also invalidate all other weekly alternates published in last historic analysis (this is linked to above). This would provide final confirmation of this main wave count.

A common range for triangle sub-waves is from about 0.8 to 0.85 the prior sub-wave, this gives a range for primary wave D from 1,158 to 1,149.

If primary wave C is correctly labelled as a double zigzag, then primary wave D must be a simple A-B-C structure and would most likely be a zigzag. Within primary wave D, minor wave B may not move beyond the start of minor wave A above 1,295.64.

Primary wave A lasted 31 weeks, primary wave B lasted 23 weeks, and primary wave C may have been complete in 25 weeks.

Primary wave D should be expected to last at least 8 weeks (but most likely longer). The next Fibonacci ratio in the sequence would be a Fibonacci 13 and then 21.


Gold Elliott Wave Chart Hourly 2017
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Minor wave 1 looks like it has moved slowly lower. There are now good Fibonacci ratios within minor wave 1.

Minor wave 2 may complete about the 0.618 Fibonacci ratio of minor wave 1 at 1,281.82. Minor wave 2 may be any one of more than 20 corrective structures. If it is an expanded flat (these are very common), then it may include a new low below its start at 1,259.75.

Minor wave 1 has lasted five days so far. Minor wave 2 should show up as at least one green daily candlestick or doji, and most likely last about three days, for the wave count to have the right look at the daily chart level. It may be choppy and overlapping.

Minor wave 2 may not move beyond the start of minor wave 1 above 1,295.65.



Gold Weekly 2017
Click chart to enlarge. Chart courtesy of

The long upper wick of this weekly candlestick is bearish. Volume is bearish. Divergence between price and RSI at this last high is bearish. ATR is bearish.

Price may have found resistance just below prior strong support at 1,305 to 1,310.


Gold Daily 2016
Click chart to enlarge. Chart courtesy of

Three days in a row of downwards movement with declining and now very light volume looks bullish. Expect a bounce here off support at 1,260. The long lower wicks of the last three daily candlesticks are bullish, and today’s candlestick completes a hammer reversal pattern.

With On Balance Volume looking very bearish, expect that any upwards movement here is likely a counter trend bounce.



GDX Daily 2016
Click chart to enlarge. Chart courtesy of

The bearish signal from On Balance Volume should be given weight. The upside for GDX now may be very limited or over.

Declining volume as price moves lower is bullish, at least short term, so look for a bounce.

Declining ADX, declining ATR, and contracting Bollinger Bands indicate that price is still consolidating.

It looks like price has found support today at the upper trend line of the prior pennant.

This analysis is published @ 05:55 p.m. EST.