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A small range upwards day moves price higher, but the candlestick closed red. Overall, this fits the Elliott wave count.

Summary: For the very short term, a small bounce may end about 1,286. Look for resistance at the neckline of a possible Head and Shoulders pattern now identified on today’s classic analysis chart. Thereafter, expect the downwards trend to continue.

The Elliott wave target is at 1,220, a new classic analysis target is now at 1,217. Risk is just above the upper edge of the base channel on the daily chart.

Three long-term targets are now calculated for cycle wave c to end. Confidence in a new downwards trend may be had with a new low below 1,160.75.

New updates to this analysis are in bold.

Grand SuperCycle analysis is here.

Last monthly charts are here. Video is here.



Gold Elliott Wave Chart Weekly 2019
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This is the preferred wave count.

Cycle wave b may be a complete regular contracting triangle. If it continues further, then primary wave E may not move beyond the end of primary wave C above 1,365.68.

Four of the five sub-waves of a triangle must be zigzags, with only one sub-wave allowed to be a multiple zigzag. Wave C is the most common sub-wave to subdivide as a multiple, and this is how primary wave C for this example fits best.

There are no problems in terms of subdivisions or rare structures for this wave count. It has an excellent fit and so far a typical look.

This wave count would expect a cycle degree trend change has recently occurred. Cycle wave c would most likely make new lows below the end of cycle wave a at 1,046.27 to avoid a truncation.

Primary wave E has exhibited reasonable weakness as it came to an end. Triangles often end with declining ATR, weak momentum and weak volume.

If this weekly wave count is correct, then cycle wave c downwards should develop strength, ATR should show some increase, and MACD should exhibit an increase in downwards momentum.

Three targets are calculated for cycle wave c. Cycle wave a lasted 4.25 years. Cycle wave b may be over in 3.17 years. Cycle wave c may last a minimum of 2 years and possibly up to 5 years.


Gold Elliott Wave Chart Daily 2019
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Cycle wave c must subdivide as a five wave structure, either an impulse or an ending diagonal. An impulse is much more common and that shall be how it is labelled unless overlapping suggests a diagonal should be considered.

A new trend at cycle degree should begin with a five wave structure on the daily chart, which will be labelled minor wave 1.

Minor wave 2 is today relabelled as a complete double zigzag after consideration on the hourly chart. This has a higher probability than prior labelling of a triple zigzag.

A base channel is drawn about minor waves 1 and 2. There will be bounces and consolidations on the way down. The last bounce has found resistance at the upper edge of the base channel. Towards its middle or end the power of a third wave may be able to break below support at the lower edge of the base channel. The upper edge of the base channel may be used to calculate a trailing stop for short positions.

Minor wave 3 may only subdivide as an impulse. Within the impulse, minute waves i and ii may now be complete and minute wave iii may only subdivide as an impulse. Within minute wave iii, no second wave correction may move beyond its start above 1,310.17.

Minute wave iii has moved below the end of minute wave i meeting a core Elliott wave rule.

It is possible that minute wave iii and / or minor wave 3 may end with a selling climax; either or both may exhibit a swift and strong fifth wave to end the impulse. This behaviour is typical of commodities, and this tendency is especially prevalent for third wave impulses.


Gold Elliott Wave Chart Hourly 2019
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The base channel is copied over from the daily chart. Minute wave ii found strong resistance about the upper edge of this channel.

The last wave down from the high labelled minute wave i is now relabelled as another single complete impulse, as minuette wave (i).

Minuette wave (ii) may continue a little higher as a double zigzag. The preferred target for it to end is the 0.382 Fibonacci ratio of minuette wave (i). The strong downwards pull of a third wave at three degrees may force minuette wave (ii) to be more shallow than second waves commonly are.


Gold Elliott Wave Chart Weekly 2019
Click chart to enlarge.

It is possible that cycle wave b may be an incomplete double zigzag or a double combination.

The first zigzag in the double is labelled primary wave W. This has a good fit.

The double may be joined by a corrective structure in the opposite direction, a triangle labelled primary wave X. The triangle would be about four fifths complete.

Within multiples, X waves are almost always zigzags and rarely triangles. Within the possible triangle of primary wave X, it is intermediate wave (B) that is a multiple; this is acceptable, but note this is not the most common triangle sub-wave to subdivide as a multiple. These two points reduce the probability of this wave count.

Intermediate wave (D) may be complete. The (B)-(D) trend line is almost perfectly adhered to with the smallest overshoot within intermediate wave (C). This is acceptable.

Intermediate wave (E) should continue to exhibit weakness: ATR should continue to show a steady decline, and MACD may begin to hover about zero.

Intermediate wave (E) may not move beyond the end of intermediate wave (C) below 1,160.75.

This wave count may now expect downwards movement for several weeks.

Primary wave Y would most likely be a zigzag because primary wave X would be shallow; double zigzags normally have relatively shallow X waves.

Primary wave Y may also be a flat correction if cycle wave b is a double combination, but combinations normally have deep X waves. This would be less likely.

This wave count has good proportions and no problems in terms of subdivisions.

Intermediate wave (E) should subdivide as a zigzag labelled minor waves A-B-C. Zigzags subdivide 5-3-5, exactly the same the start of an impulse.

The preferred wave count labels downwards movement minor waves 1-2-3, and this wave count labels downwards movement minor waves A-B-C. At the daily and hourly chart levels, the subdivisions for both wave counts are seen in the same way.



Gold Elliott Wave Chart Weekly 2019
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If Gold is in a new bull market, then it should begin with a five wave structure upwards on the weekly chart. However, the biggest problem with this wave count is the structure labelled cycle wave I because this wave count must see it as a five wave structure, but it looks more like a three wave structure.

Commodities often exhibit swift strong fifth waves that force the fourth wave corrections coming just prior to be more brief and shallow than their counterpart second waves. It is unusual for a commodity to exhibit a quick second wave and a more time consuming fourth wave, and this is how cycle wave I is labelled. The probability of this wave count is low due to this problem.

Cycle wave II subdivides well as a double combination: zigzag – X – expanded flat.

Cycle wave III may have begun. Within cycle wave III, primary wave 1 may now be complete. The target for primary wave 2 is the 0.618 Fibonacci ratio of primary wave 1. Primary wave 2 may not move beyond the start of primary wave 1 below 1,160.75.

A black channel is drawn about primary wave 1. Primary wave 2 may breach the lower edge of this channel.

Cycle wave III so far for this wave count would have been underway now for 36 weeks. It should be beginning to exhibit some support from volume, increase in upwards momentum and increasing ATR. However, ATR continues to decline and is very low, and momentum is weak in comparison to cycle wave I. This wave count lacks support from classic technical analysis.



Gold Weekly 2019
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Downwards movement has unfolded as expected last week. With the week a short-trading week, no conclusion may be drawn from lighter volume.


Gold Daily 2019
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From August 2018 Gold moved higher with a series of higher highs and higher lows. This series remained intact until the 1st of March 2019 when a lower low was made. At that stage, it was possible that Gold had seen a trend change.

There is now a new series of two lower swing highs and two lower swing lows. This supports the idea that there has been a trend change and Gold is in a new downwards trend. ADX now agrees.

The trend line breached by On Balance Volume was long held, tested multiple times, and near horizontal. This trend line holds strong technical significance and a breach of support there is a strong bearish signal. This supports the Elliott wave count. Today On Balance Volume may be testing resistance for a throw back to that trend line.

Today a complex Head and Shoulders pattern is identified. The neck line has been breached, and a throw back may now be testing resistance at prior support. The neck line may show where this bounce may end. A target is at 1,217.


GDX Weekly 2019
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There is now a series of two lower highs and lower lows at the weekly chart level. GDX may have seen a trend change to downwards, but ADX does not yet agree. The bearish signal from On Balance Volume supports this view.


GDX Daily 2019
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At the daily chart level, the view of an upwards trend may be in doubt with a new swing low on the 1st of March 2019 that moved below the prior swing low of the 14th of February 2019. At that stage, the series of higher highs and higher lows was no longer intact and a trend change was possible.

Since then price has not made another higher high.

Price closed below the lower triangle trend line on a downwards day that has support from volume. Volume is not required for a downwards breakout, but more confidence in the breakout may be had when volume does support downwards movement.

A target calculated from the triangle width is now at 19.58.

Published @ 09:58 p.m. EST.

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