Today’s Stockcharts data shows a downwards breakout from the triangle. The targets remain the same.
Summary: The Elliott wave target is at 1,348.
A target calculated from the adjusted triangle is about 1,431.
For the very short term, a new high above 1,516.65 would add some confidence in a more bullish outlook. The target would then be at 1,567, 1,652 or 1,693.
For the bigger picture, the bearish Elliott wave count expects a new downwards trend to last one to several years may begin after one more high. The alternate bearish wave count looks at the possibility that a major high is already in. Confidence in this view may be had if price makes a new low by any amount at any time frame below 1,346.45.
The bullish Elliott wave count expects a primary degree fourth wave has completed and the upwards trend has resumed.
Grand SuperCycle analysis is here.
Monthly charts were last published here.
BEARISH ELLIOTT WAVE COUNT
WEEKLY CHART
Click chart to enlarge.
It is possible that Super Cycle wave (b) is nearly complete as a double zigzag.
The first zigzag in the double is labelled cycle wave w. The double is joined by a three in the opposite direction, a triangle labelled cycle wave x. The second zigzag in the double is labelled cycle wave y.
The purpose of the second zigzag in a double is to deepen the correction. Cycle wave y has achieved this purpose.
A new low below 1,346.45 would add strong confidence to this wave count. At that stage, the bullish Elliott wave count would be invalidated.
A wide best fit channel is added in light blue. This channel contains all of Super Cycle wave (b) and may provide resistance and support. Copy this channel over to daily charts.
DAILY CHART
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Today the main and alternate bear wave counts are swapped over. Classic analysis now reasonably supports this wave count.
Cycle wave y may be a complete zigzag. Within both of primary waves A and C, there is good proportion between intermediate waves (2) and (4). Within both of primary waves A and C, there is good alternation in structure of intermediate waves (2) and (4).
Within cycle wave y, there is no Fibonacci Ratio between primary waves A and C.
Draw a base channel on daily and hourly charts about minor waves 1 and 2. Draw the first trend line from the start of minor wave 1 to the end of minor wave 2, then place a parallel copy on the end of minor wave 1.
Gold does not always fit neatly within base channels. Occasionally, second wave corrections can be deep and time consuming and can breach base channels. This wave count remains valid. A very strong breach of the base channel reduces the probability of this wave count.
HOURLY CHART
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This chart follows the middle of minor wave 3 from the high of minuette wave (ii), which can be seen on the daily chart.
Gold typically exhibits swift strong fifth waves. This tendency is especially prevalent in fifth waves to end third wave impulses. Look out for the possibility of downwards movement strengthening for any one or more of minuette wave (iii), minute wave iii or minor wave 3.
Within subminuette wave iii, micro wave 4 may not move into micro wave 1 price territory above 1,489.63.
ALTERNATE DAILY CHART
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This wave count exactly follows the expected pathway for Silver.
It is possible that the double zigzag for Super Cycle wave (b) may be incomplete and may yet require one more high.
Within cycle wave y, primary wave A may have been over at the last high. Primary wave B may now be continuing a little lower as a double zigzag. Primary wave B may not move beyond the start of primary wave A below 1,266.61.
When primary wave B may again be over, then a new target for primary wave C to end may be calculated. Primary wave C would be expected to find strong resistance and end at the upper edge of the blue best fit channel copied over from the weekly chart.
BULLISH ELLIOTT WAVE COUNT
WEEKLY CHART
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This wave count sees the the bear market complete at the last major low for Gold in November 2015.
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 and just after 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. This wave count still suffers from this very substantial problem, and for this reason the bearish wave count is still considered because it has a better fit in terms of Elliott wave structure.
Cycle wave II subdivides well as a double combination: zigzag – X – expanded flat.
Cycle wave III may have begun. Within cycle wave III, primary waves 1 and 2 may now be complete. Primary wave 3 has now moved above the end of primary wave 1 meeting a core Elliott wave rule. It has now moved far enough to allow room for primary wave 4 to unfold and remain above primary wave 1 price territory. Primary wave 4 may not move into primary wave 1 price territory below 1,346.45.
Cycle wave III so far for this wave count would have been underway now for 63 weeks. It exhibits some support from volume and increasing ATR. This wave count has some support from classic technical analysis.
The channel drawn about cycle wave III is an adjusted Elliott channel. The lower edge is pulled lower.
Add the wide best fit channel to weekly and daily charts.
DAILY CHART
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Primary wave 4 may be continuing lower as a double zigzag. The second zigzag in the double, labelled intermediate wave (Y), would be almost complete.
When primary wave 4 may again be complete, then the target for cycle wave III may be calculated also at primary degree. The current cycle wave III target may change at that stage, to widen to a zone, or a second target may be added.
Primary wave 4 may not move into primary wave 1 price territory below 1,346.45.
HOURLY CHART
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Within the second zigzag of intermediate wave (Y), minor wave C must subdivide as a five wave structure. So far, minute waves i, ii and iii may be complete. Minute wave iv may not move into minute wave i price territory above 1,480.59.
If the target is wrong, it may not be low enough.
TECHNICAL ANALYSIS
MONTHLY CHART
Click chart to enlarge. Chart courtesy of StockCharts.com.
Overall, this chart is bullish. However, with RSI reaching overbought at the last high, upwards movement may be limited.
The last two months of sideways movement look like a consolidation within an ongoing upwards trend.
Some suspicion regarding the current upwards trend may be warranted by bearish divergence between price and On Balance Volume at the last lows.
WEEKLY CHART
Click chart to enlarge. Chart courtesy of StockCharts.com.
When trends reach very extreme, candlestick reversal patterns should be given weight. The Dark Cloud Cover bearish reversal pattern is given more bearish weight from the long upper wick.
This pullback has brought RSI and Stochastics down from overbought and ADX down from very extreme. It looks like a high may be in place for Gold, but it is also possible that one final high may yet be seen before a major trend change.
For the short term, the picture is looking slightly more clearly bullish. Long lower wicks, support from volume for upwards movement, and a bullish signal from On Balance Volume all suggest more upwards movement just ahead.
DAILY CHART
Click chart to enlarge. Chart courtesy of StockCharts.com.
Since the last high on the 4th of September, there is now a series of swing lows and swing highs. Today’s Stockcharts data shows a strong downwards day that has made a new swing low.
After a breakout from the triangle today, the target is to be about 1,431.
GDX WEEKLY CHART
Click chart to enlarge. Chart courtesy of StockCharts.com.
The short term picture for GDX remains bullish. ADX and RSI have been bought down from extreme. There is again room for an upwards trend to continue.
GDX DAILY CHART
Click chart to enlarge. Chart courtesy of StockCharts.com.
There is now a series of three lower highs and three lower lows from the high on the 4th of September. It still looks like GDX may have had a trend change. This view should remain dominant while the last swing high at 28.38 on the 8th of October remains intact.
Published @ 08:08 p.m. EST.
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New updates to this analysis are in bold.
weekly candle on gold is about as bearish as they come. Have a good weekend everyone
https://www.tradingview.com/x/iOehh8PK/
hourly bear chart updated
another five down looks clear and complete
hourly bull chart updated
I’m liking the alternate bear count/bull count today. Target was hit. I went long after the spike up, hopefully it sticks
Silver seems to be holding this daily trendline so far
https://www.tradingview.com/x/W3cFoI0b/
FYI there’s a new daily chart in comments on the last Bitcoin post. I don’t think the next low is in yet.
Thank you.
How do we get back to it, Lara ? It’s fallen off the recent updates.
Select categories from the right column
Hi Lara, Checked for the new daily chart, but last one i see is dated 24th Sept. Could you point me in the right direction. Thanks
Found it
Thanks for the dxy analysis, it’s very much appreciated!
you’re welcome, and I’m sorry it took me so long to get around to it
maybe I need to visit my hardware store and buy some round tuit’s
Dxy is such a long term chart. If gold keeps on the bear path I think the dollar could skyrocket. Noone thinks it’s possible with the Fed, but I have learned all too often the majority are wrong. Thanks for all your clear analysis and have a great weekend!