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Further downwards movement was expected from the Elliott wave count. The target remains the same.

Summary: Downwards movement may be over for the short term. Confidence in this view may be had if price moves into the upper half of the Elliott channel on the hourly chart. If a bounce has just begun, then it may end about 1,262 or 1,275.

Accept it is possible price may move lower while it remains in the lower half of the Elliott channel. The limit is at 1,229.88.

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.

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.

There are three alternate wave counts that have been published in the last historic analysis, which is linked to above. They are all very bullish. Members may like to review them at this stage. They will only be published on a daily basis if price shows them to be true with a new high now above 1,295.65.


Gold Elliott Wave Chart Daily 2017
Click chart to enlarge.

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.

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 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.

At the hourly chart level, intermediate wave (A) may now be complete. However, this view requires some upwards movement from price before confidence may be had in it. If intermediate wave (A) is over, then it would have lasted 10 days (not a Fibonacci number). For the wave count to have the right look intermediate wave (B) may be at least even in duration with intermediate wave (A).

Intermediate wave (B) may be any one of more than 23 possible corrective structures. It may be a swift sharp zigzag with a strong upwards slope, or it may be a shallow sideways complicated combination, triangle or flat. It is impossible until it is almost complete to know with confidence what structure it has taken. B waves exhibit the greatest variety in price behaviour and structure, so they do not present good trading opportunities.

Only the most experienced of traders should attempt to trade B waves, even at intermediate degree. If members choose to attempt to trade intermediate wave (B) upwards, it is my strong advice to reduce risk to only 1-3% of equity. It is essential that stops are always used.

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 3 was shorter than minor wave 1. This limits minor wave 5 to no longer than equality in length with minor wave 3, so that minor wave 3 is not the shortest actionary wave within the impulse. This limit is at 1,229.88.

There is perfect alternation between the deep zigzag of minor wave 2 and the shallow combination of minor wave 4.

Minor wave 5 may have ended with a Fibonacci ratio to minor wave 3 and not minor wave 1, which was expected. The bullish engulfing candlestick pattern at the low offers a very small support to this view.

Because minor wave 5 sat within the lower half of the Elliott channel, if price returns to the upper half of the channel that would be a strong indication that minor wave 5 may be over. A breach of the upper edge of the channel may be taken as confirmation of a trend change.

Intermediate wave (B) may end about either the 0.382 or 0.618 Fibonacci ratios of intermediate wave (A). Neither is favoured; they have an even probability.



Gold Weekly 2017
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The long upper wicks on the last two weekly candlesticks are bearish. Volume supports the downwards movement in price, so this is not suspicious.

Declining ATR fits with the Elliott wave count at the weekly chart level; this is normal for triangles.


Gold Daily 2016
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A small range day with lighter volume finds strong support at the 200 day moving average. It would be reasonable to expect some bounce about here. This supports the hourly Elliott wave count.

Resistance is about 1,260.

There is room for price to keep falling. RSI is not extreme and Stochastics does not exhibit divergence with price.



GDX Daily 2016
Click chart to enlarge. Chart courtesy of

Bullish divergence between price and On Balance Volume has persisted for two days. This does not mean price must stop falling here. It only indicates some weakness in downwards movement.

ATR also signals increasing weakness. Volume indicates the market is falling of its own weight.

Look out now for a bounce in GDX here or very soon.

This analysis is published @ 08:16 p.m. EST.