Tag Archives: elliott wave technical analysis

US OIL Elliott Wave Technical Analysis – 4th September, 2013

Last week’s analysis expected more upwards movement from US Oil, which is not what happened. Price has moved lower to breach the invalidation point at 108.17 on the daily chart.

Click on the charts below to enlarge.

US Oil Elliott Wave Chart Daily 2013

Cycle wave b is incomplete, and is unfolding as a double zigzag. Primary wave X within it was a contracting triangle.

Extend the triangle trend lines outwards. The point in time at which they cross over may see a trend change, and this may be where primary wave Y ends.

There is not normally a Fibonacci ratio between subwaves W and Y within doubles. A more reliable way to calculate a target for this to end is using the ratio between intermediate waves (A) and (C) within the second zigzag of the double.

At 122.55 intermediate wave (C) would reach 2.618 the length of intermediate wave (A). At 120.84 minor wave 5 would reach 2.618 the length of minor wave 1.

Cycle wave b may not move beyond the start of cycle wave a. This wave count is invalidated with movement above 146.73.

US Oil Elliott Wave Chart Hourly 2013

There are two structural possibilities for minor wave 5: either an impulse or an ending diagonal. The impulse was invalidated with movement below 108.17. Minor wave 5 is most likely unfolding as an ending expanding diagonal.

Within the diagonal all the subwaves must subdivide into zigzags, including the third wave. The fourth wave of a diagonal should overlap back into first wave price territory, but may not move beyond the end of the second wave. Minute wave iv may not move below 103.51.

Within minute wave i zigzag there is no Fibonacci ratio between subminuette waves (a) and (c).

Within minute wave ii zigzag there is no Fibonacci ratio between subminuette waves (a) and (c).

Within minute wave iii zigzag minuette wave (c) is 0.47 longer than 1.618 the length of minuette wave (a).

Within minute wave iv zigzag minuette wave (c) is 0.27 short of 0.618 the length of minuette wave (a).

Minute wave iii is longer than minute wave i, and minute wave iv is longer than minute wave ii. The diagonal is expanding. This would expect minute wave v to be longer than equality with minute wave iii which would be achieved at 114.27. We should expect upwards movement to reach this point at least.

I have seen diagonals sometimes have a third wave which is still the longest, so this minimum is a guideline with a good probability but if it is not reached, as long as the subdivisions are correct, the diagonal may still be valid.

GOLD Elliott Wave Technical Analysis – 3rd September, 2013

Price moved higher as expected. The main wave count remains the same.

I have a new alternate hourly wave count for you today. Both hourly wave counts expect more upwards movement, and the difference is in expected momentum.

Click on the charts below to enlarge.

Gold Elliott Wave Chart Daily 2013

Primary wave C may be complete.

A best fit parallel channel is so far clearly breached by upwards movement, no matter how the channel is drawn. This indicates a probable trend change.

Cycle wave V should last between one to several years and is most likely to take price to new all time highs.

In the short term at 1,545 minor wave 3 would reach 1.618 the length of minor wave 1.

Within the new upwards trend of cycle wave V, within minute wave iii no second wave correction may move beyond the start of the first wave. This wave count is invalidated with movement below 1,315.92.

Main Hourly Wave Count.

GOLD Elliott Wave Chart Hourly 2013

Finally we have a nice clear channel breach of the small channel containing minute wave iv downwards. Once the channel was clearly breached price continued to rise.

So far within minute wave v we may have a series of two first and second waves. This would expect a small increase in upwards momentum over the next one to three days as the middle of minuette wave (iii) within minute wave v unfolds.

Within minute wave v no second wave correction may move beyond the start of the first wave. This wave count is invalidated with movement below 1,374.14.

Alternate Hourly Wave Count.

GOLD Elliott Wave Chart Hourly Alternate 2013

This alternate wave count is identical to the main wave count up to the low at 1,316.05 labeled minute wave ii. Thereafter, I have simply moved the degree of labeling within each of the two subsequent upwards impulses and their corresponding downwards corrections, down one degree.

We may be seeing a more extended minor wave 3 which has begun with a series of first and second waves. This alternate wave count also expects more upwards movement, but it expects a strong increase in upwards momentum.

This wave count fits better with MACD. The only problem with it is the duration of subminuette wave ii in comparison with minuette wave (ii) and minute wave ii, one and two degrees higher. Subminuette wave ii is longer in duration giving a lack of proportion to this wave count.

If we see a strong increase in upwards momentum over the next few days I would use this as my main wave count.

Within minuette wave (iii) subminuette wave ii may not move beyond the start of subminuette wave i. This wave count is invalidated with movement below 1,359.24.

GOLD Elliott Wave Technical Analysis – 2nd September, 2013

Last analysis expected the end of a fourth wave correction to be confirmed by a channel breach on the hourly chart. We did not get a confirmation that the correction was over. Price continued lower breaching invalidation points on both hourly wave counts.

Click on the charts below to enlarge.

Gold Elliott Wave Chart Daily 2013

Primary wave C may be complete. Primary wave C is 28.96 short of 1.618 the length of primary wave A.

Ratios within primary wave C are: there is no Fibonacci ratio between intermediate waves (3) and (1), and intermediate wave (5) is 13.77 short of 0.618 the length of intermediate wave (3).

Within intermediate wave (1) there are no adequate Fibonacci ratios between minor waves 1, 3 and 5.

Ratios within intermediate wave (3) are: minor wave 3 is 24.72 longer than 2.618 the length of minor wave 1 (a 6.8% variation; I consider less than 10% acceptable), and minor wave 5 is 11.74 longer than 0.382 the length of minor wave 3.

Ratios within minor wave 3 are: minute wave iii is 10.78 longer than 2.618 the length of minute wave i, and minute wave v has no Fibonacci ratio to minute wave i.

Ratios within intermediate wave (5) are: minor wave 3 has no Fibonacci ratio to minor wave 1, and minor wave 5 is just 1.61 short of equality with minor wave 3.

A best fit parallel channel is so far clearly breached by upwards movement, no matter how the channel is drawn. This indicates a probable trend change.

Within the new upwards trend of cycle wave V, within minute wave iii no second wave correction may move beyond the start of the first wave. This wave count is invalidated with movement below 1,315.92.

GOLD Elliott Wave Chart Hourly 2013

This downwards movement cannot be minuette wave (iv) within minute wave iii, nor can it be subminuette wave iv within minuette wave (iii). Both of those wave counts were invalidated in last analysis.

The structure for this third wave, minor wave 3, is most likely incomplete. I have tried to see a five wave impulse completed within this upwards wave, but within it the third wave would be slightly the shortest. This core Elliott wave rule cannot be broken.

Within minor wave 3 incomplete this downwards movement is likely to be a fourth wave correction. It may be minute wave iv.

Minute wave iii is just 2.58 longer than 1.618 the length of minute wave i.

Ratios within minute wave iii are: minuette wave (iii) is 4.37 longer than 1.618 the length of minuette wave (i), and minuette wave (v) is 1.27 short of 2.618 the length of minuette wave (i).

Minuette wave (v) is extended. Ratios within minuette wave (v) are: there is no Fibonacci ratio between subminuette waves iii and i, and subminuette wave v is 3.28 longer than 1.618 the length of subminuette wave i.

There is nice alternation between minute wave ii, a shallow 40% single zigzag, and minute wave iv, a slightly deeper 51% double zigzag.

A clear trend channel breach of the downwards sloping smaller channel about minute wave iv would provide confirmation that the correction is over and the next wave is underway. We still do not have this confirmation.

Movement above 1,413.97 would be strong indication that minute wave iv is completed as at that stage it could not be a second wave correction within subminuette wave c of minuette wave (y), and so minuette wave (y) would have to be over.

GOLD Elliott Wave Technical Analysis – 30th August, 2013

Gold moved lower in a fourth wave correction, which was expected, and we had no confirmation that the correction was over.

The wave count remains the same at the daily chart level, with two hourly wave counts for you today.

Click on the charts below to enlarge.

Gold Elliott Wave Chart Daily 2013

Primary wave C may be complete. Primary wave C is 28.96 short of 1.618 the length of primary wave A.

Ratios within primary wave C are: there is no Fibonacci ratio between intermediate waves (3) and (1), and intermediate wave (5) is 13.77 short of 0.618 the length of intermediate wave (3).

Within intermediate wave (1) there are no adequate Fibonacci ratios between minor waves 1, 3 and 5.

Ratios within intermediate wave (3) are: minor wave 3 is 24.72 longer than 2.618 the length of minor wave 1 (a 6.8% variation; I consider less than 10% acceptable), and minor wave 5 is 11.74 longer than 0.382 the length of minor wave 3.

Ratios within minor wave 3 are: minute wave iii is 10.78 longer than 2.618 the length of minute wave i, and minute wave v has no Fibonacci ratio to minute wave i.

Ratios within intermediate wave (5) are: minor wave 3 has no Fibonacci ratio to minor wave 1, and minor wave 5 is just 1.61 short of equality with minor wave 3.

A best fit parallel channel is so far clearly breached by upwards movement, no matter how the channel is drawn. This indicates a probable trend change.

Within the new upwards trend of cycle wave V, within minute wave iii no second wave correction may move beyond the start of the first wave. This wave count is invalidated with movement below 1,315.92.

First Hourly Wave Count.

GOLD Elliott Wave Chart Hourly 2013

This wave count follows on directly from last analysis. The downwards movement for the last two days may be minuette wave (iv) within an extending third wave of minute wave iii.

At this stage minuette wave (iv) subdivides best as a double zigzag. The second zigzag structure is completed. There is nice alternation between minuette waves (ii) and (iv) so far; minuette wave (ii) is a relatively shallow 43% single zigzag, minuette wave (iv) is a relatively deep 53% double zigzag.

When the best fit parallel channel drawn about minuette wave (iv) is clearly breached by upwards movement we shall have an indication that minuette wave (v) has begun.

Ratios within minuette wave (iii) are: subminuette wave iii has no Fibonacci ratio to subminuette wave i, and subminuette wave v is 1.11 longer than 1.618 the length of subminuette wave i.

At 1,431 minute wave iii would reach 1.618 the length of minute wave i. This target is probably too low, and it would expect a very short fifth wave. At 1,502 minute wave iii would reach 2.618 the length of minute wave i.

When minuette wave (iv) has ended then the target for minute wave iii can be calculated at a second wave degree, so it may widen to a zone or it may change.

Minuette wave (iv) may not move into minuette wave (i) price territory. This wave count is invalidated with movement below 1,384.60.

If this first wave count is invalidated with downwards movement then we should use the second wave count below.

Second Hourly Wave Count.

GOLD Elliott Wave Chart Hourly 2013

If we see the movement within minuette wave (ii) differently, it may have been over sooner. This second wave count avoids the problem of a truncated C wave within minuette wave (ii). Downwards movement for the last two days is still a fourth wave correction, but one degree lower.

There is no Fibonacci ratio between subminuette waves iii and i.

All subdivisions from the start of subminuette wave iii are seen in the same way for both wave counts, but here only the degree of labeling differs. The key difference within minuette wave (ii) is the downwards piece of movement labeled here submiuette wave c. This second wave count sees it as a five wave structure, and the first wave count sees it as a three. On the five minute chart it fits a little better as a three.

If price moves below 1,384.60 the first wave count would be invalidated. This wave count would remain valid and would be the best explanation I can see.

Subminuette wave iv may not move into subminuette wave i price territory. This wave count is invalidated with movement below 1,377.74.

GOLD Elliott Wave Technical Analysis – 29th August, 2013

At the hourly chart level Gold has behaved as expected, continuing lower for a fourth wave correction. The target was 1,401. So far price has reached down to 1,402.63, but it cannot be confirmed that this correction is over. The hourly chart will be shown at the end of this analysis with a brief explanation.

Today I will focus the analysis on the monthly charts, at super cycle degree. I will also compare Gold to Silver.

Click on the charts below to enlarge.

Gold – Monthly Chart – Super Cycle Wave Count.

Gold Elliott Wave Chart Monthly - Super Cycle 2013

At super cycle degree for gold it looks like we have either seen the end of a long grand super cycle wave, or are close to the end. The key is the final fifth wave up at super cycle degreeā€“is this structure complete or not? Is the recent downwards movement cycle wave IV within super cycle wave V, or is super cycle wave V over?

The next two monthly charts for gold will look at two possible interpretations for this structure. The wave count with the best fit and best Fibonacci ratios would be the most likely.

In comparison to silver we can see that these two markets do not always turn together. They are close, but not at the same time. Sometimes there is a difference of several months, and in the case of the 1990’s low for both markets gold turned 6 years and 5 months after silver found its low. In the case of the all time high gold turned 5 months after silver.

Silver appears to precede Gold. For this reason I have no problem with two wave counts for these markets that sees Silver having already completed a structure which Gold is yet to see unfold.

Although overall at the monthly chart level these two markets have similar looks, they are not the same. The wave structure must be different if the highs and lows are different.

Silver – Monthly Chart – Super Cycle Wave Count.

Silver Elliott Wave Chart Monthly - Super Cycle 2013

This chart is provided for comparison to the gold chart above. The highs and lows of both markets are highlighted on both charts.

This wave count for silver expects a new low to be formed before gold gets there. Which would fit with what has historically happened.

Screen shot 2013-08-29 at 11.32.19 PM

The table above compares Fibonacci ratios between the main and alternate wave counts for gold within cycle wave V. The main wave count is slightly better. Within the alternate there are no Fibonacci ratios within the middle of the third wave which is highly unusual for this market, and so must reduce the probability of the alternate wave count.

Gold – Main Monthly Wave Count.

Gold Elliott Wave Chart Monthly 2013

This will remain my main monthly wave count for gold because it has better Fibonacci ratios, particularly in the middle of the third wave. It is extremely common for gold to have excellent Fibonacci ratios in its third waves.

This wave count is adjusted from my last published analysis of the monthly chart. I have moved cycle waves I and II up. Previously, they were in the position where intermediate waves (3) and (4) now occupy, within primary wave 5 of cycle wave I. This change gives better proportion to cycle wave II.

With this labeling when we draw a channel about the upwards impulse using Elliott’s first technique cycle wave IV has strongly overshot the channel. Sometimes fourth waves do this and when they do we redraw the channel using Elliott’s second technique, and this is how I’ve drawn it. With this there is an overshoot for the end of cycle wave III which is very common.

If cycle wave V upwards has just begun, it should last about a year or longer. At 1,961 cycle wave V would reach equality in length with cycle wave I.

Cycle wave IV may not move into cycle wave I price territory. This wave count would be invalidated with movement below 1,032.70.

Gold – Alternate Monthly Wave Count.

Gold Elliott Wave Chart Monthly Alternate 2013

Alternatively, it is possible that a grand super cycle wave I is complete and this recent downwards movement is the start of a grand super cycle wave II.

At this stage, because the first part of the correction subdivides into a three wave structure, the correction may be a flat or double, both of which allow for new price extremes above 1,921.15 (a new all time high). A flat would expect upwards movement from here to subdivide as a three for cycle wave b which must reach a minimum of 90% the length of cycle wave a at 1,847 or above.

Alternatively, it may be that cycle wave a is an incomplete impulse. If that is the case then upwards movement which began on 28th June, 2013, would be a fourth wave correction at primary wave degree. It may not move into what would be primary wave 1 price territory (labeled here as primary wave A) above 1,522.75.

Movement above 1,522.75 would confirm the downwards correction as a completed three wave structure. At that stage I would have confidence that price should keep rising to about 1,847 or above and may make new highs.

In the mid to long term this alternate wave count does not diverge from the main wave count. Close attention to the structure of the next wave upwards is required to determine which of these two monthly wave counts is correct; if it is a three wave corrective structure this alternate is correct, and if it is a five wave motive structure the main wave count is correct.

GOLD Elliott Wave Chart Hourly 2013

This hourly chart follows on directly from yesterday’s analysis.

Within minuette wave (iv) the structure may be complete, but it is also equally as likely that subminuette wave y may be an incomplete triangle.

Movement above the small parallel channel containing minuette wave (iv) would provide some confidence that minuette wave (iv) is over and minuette wave (v) has begun.

Minuette wave (iv) may not move into minuette wave (i) price territory. This wave count is invalidated with movement below 1,384.60.

Silver Elliott Wave Technical Analysis – 29th August, 2013

Last analysis of silver was published on 5th May, 2013. It’s time to update this analysis. I will endeavor to update Silver for you once a week, time permitting.

Click on the charts below to enlarge.

Silver monthly 2013

At the monthly chart level the long rise for silver to the all time high at 49.51 looks like a completed five wave impulse. Because this lasted generations it may be a grand super cycle wave.

No matter what degree downwards movement is labeled, it is a correction and it is incomplete.

The current corrective structure is unfolding as a double zigzag. Primary wave W is a zigzag, and the double is joined by a correction in the opposite direction, a triangle labeled primary wave X. The second structure in the double has begun with a completed five wave structure downwards, and it is also unfolding as a zigzag. This corrective structure at cycle degree is a double zigzag.

The second zigzag of primary wave Y is incomplete.

Silver weekly 2013

Within the first zigzag in the double, primary wave W, intermediate wave (C) is just 0.67 longer than intermediate wave (A).

Primary wave X is a completed regular contracting triangle.

Primary wave Y is incomplete.

Silver daily 2013

Within primary wave Y downwards movement for intermediate wave (A) subdivides nicely into a five wave impulse.

Ratios within intermediate wave (A) are: there is no Fibonacci ratio between minor waves 3 and 1, and minor wave 3 is just 0.01 short of 0.382 the length of minor wave 3.

Within intermediate wave (B) so far the structure may be unfolding as a zigzag. Minor wave A is an incomplete five wave impulse.

Upwards movement for minute wave iii within minor wave A is showing a strong increase in upwards momentum, indicating a third wave which indicates an impulse for minor wave A.

At 25.44 minute wave iii would reach 2.618 the length of minute wave i.

When minute wave iii is complete then minute wave iv may not move into minute wave i price territory. This wave count is invalidated with movement below 20.613.

If price moves below 20.613 then minor wave A subdivided into a three wave zigzag. At that stage we should expect minor wave B to reach down to at least 90% the length of minor wave A, and to be very likely to make a new low below the start of minor wave A at 18.215. Intermediate wave (B) then may unfold as a flat or combination.

GOLD Elliott Wave Technical Analysis – 28th August, 2013

I am changing my wave count today at the daily chart level.

The short to mid term outlook is unchanged, and the subdivisions on the hourly chart remain the same.

Click on the charts below to enlarge.

Gold Elliott Wave Chart Daily 2013

Primary wave C may be complete. Primary wave C is 28.96 short of 1.618 the length of primary wave A.

Ratios within primary wave C are: there is no Fibonacci ratio between intermediate waves (3) and (1), and intermediate wave (5) is 13.77 short of 0.618 the length of intermediate wave (3).

Within intermediate wave (1) there are no adequate Fibonacci ratios between minor waves 1, 3 and 5.

Ratios within intermediate wave (3) are: minor wave 3 is 24.72 longer than 2.618 the length of minor wave 1 (a 6.8% variation; I consider less than 10% acceptable), and minor wave 5 is 11.74 longer than 0.382 the length of minor wave 3.

Ratios within minor wave 3 are: minute wave iii is 10.78 longer than 2.618 the length of minute wave i, and minute wave v has no Fibonacci ratio to minute wave i.

Ratios within intermediate wave (5) are: minor wave 3 has no Fibonacci ratio to minor wave 1, and minor wave 5 is just 1.61 short of equality with minor wave 3.

A best fit parallel channel is so far clearly breached by upwards movement, no matter how the channel is drawn. This indicates a probable trend change.

Within the new upwards trend of cycle wave V, within minute wave iii no second wave correction may move beyond the start of the first wave. This wave count is invalidated with movement below 1,315.92.

GOLD Elliott Wave Chart Hourly 2013

The subdivisions and degree of labeling for this hourly chart are the same as previous analysis.

Within minute wave iii minuette wave (iii) is now complete and has no Fibonacci ratio to minuette wave (i). This means it is more than likely minuette wave (v) shall exhibit a Fibonacci ratio to minuette waves (i) or (iii). When minuette wave (iv) has ended I can add to the target calculation for minute wave iii to end at minuette wave degree. I may be able to do that tomorrow for you.

At 1,401 subminuette wave c within minuette wave (iv) would reach equality with subminuette wave a. This would bring minuette wave (iv) to just below the 0.382 Fibonacci ratio of minuette wave (iii).

Mineutte wave (iv) may also be deeper if it is to show alternation in depth with minuette wave (ii). Minuette wave (ii) was a shallow 43% of minuette wave (i). Minuette wave (iv) could end about 1,385.30, the 0.618 Fibonacci ratio of minuette wave (iii).

Minuette wave (iv) may show alternation in structure. Minuette wave (ii) was time consuming zigzag, with a complicated subminuette wave b within it. Minuette wave (iv) may be a briefer simpler zigzag, or it may yet continue further as a flat, combination or triangle.

Minuette wave (iv) is so far showing up on the daily chart with a red candlestick. It may be close to completion, or it may last another one or two days at the most.

Minuette wave (iv) may not move into minuette wave (i) price territory. This wave count is invalidated with movement below 1,384.60.

When minuette wave (iv) is completed then further upwards movement for minuette wave (v) should unfold. At 1,431 minute wave iii would reach 1.618 the length of minute wave i.

Alternate Wave Count.

Gold Elliott Wave Chart Daily Alternate 2013

It remains possible that primary wave C is not over and requires on final fifth wave down. However, the size of intermediate wave (4) now is so much larger than intermediate wave (2) that this wave count no longer has the right look.

I would only now seriously consider it if the main wave count is invalidated with movement below 1,315.92.

Intermediate wave (4) may not move into intermediate wave (1) price territory. This wave count is invalidated with movement above 1,672.77.

US Oil Elliott Wave Technical Analysis – 27th August, 2013

Movement above 110.56 has invalidated the main monthly wave count and confirmed the alternate. This upwards movement is not yet over.

Click on the charts below to enlarge.

US Oil monthly 2013

Movement above 110.56 has confirmed this wave count.

Cycle wave b is not over and is completing a double zigzag, with primary wave X within it a contracting triangle.

I have adjusted the wave count within the triangle of primary wave X. It now fits nicely within the triangle trend lines and has a more typical look. Intermediate wave (E) undershoots the A-C trend line.

Extend the triangle trend lines outwards. The point in time at which they cross over may see a trend change, this may be where primary wave Y ends.

We should expect a continuation of upwards movement from oil for some weeks yet. There is not normally a Fibonacci ratio between subwaves W and Y within doubles.

Cycle wave b may not move beyond the start of cycle wave a. This wave count is invalidated with movement above 146.73.

US Oil daily 2013

Within cycle wave Y intermediate wave (A) is a completed five wave impulse, intermediate wave (B) is a completed regular flat correction, and intermediate wave (C) is an incomplete impulse.

At 122.55 intermediate wave (C) would reach 2.618 the length of intermediate wave (A). At 120.84 minor wave 5 would reach 2.618 the length of minor wave 1.

Minor wave 3 is 0.95 longer than 1.618 the length of minor wave 1.

The structure within minor wave 5 is incomplete. It requires further upwards movement.

US Oil hourly 2013

Within minute wave iii the structure is incomplete. The middle of the third wave is nearing its end. Minuette wave (iii) is so far 0.17 longer than 1.618 the length of minuette wave (i). It may not be over there though. It should be over soon, and when it is minuette wave (iv) should move price lower in very choppy overlapping movement.

Minuette wave (ii) was a relatively shallow 47% zigzag correction. Given the guideline of alternation we may expect minuette wave (iv) to be relatively deep. Minuette wave (iv) is likely to end within the price range of the fourth wave of one lesser degree, between 109.32 and 108.64.

When it is complete the upwards trend should resume.

At 119.03 minute wave iii would reach 2.618 the length of minute wave i.

If minuette wave (iii) moves higher then redraw the channel. Draw the first trend line from the highs of minuette waves (i) to (iii), then place a parallel copy upon the low of minuette wave (ii). Expect minuette wave (iv) may find support at the lower edge of this channel.

Minuette wave (iv) may not move into minuette wave (i) price territory. This wave count is invalidated with movement below 107.35.

GOLD Elliott Wave Technical Analysis – 27th August, 2013

Last analysis main wave count expected more upwards movement. The alternate was not confirmed with a red candlestick or any channel breach.

Again I have two wave counts for you today. They differ only in the degree of labeling for most recent movement. The price point which differentiates them is 1,384.60.

Click on the charts below to enlarge.

Main Wave Count.

Gold Elliott Wave Chart Daily 2013

This daily chart focuses on the new downwards trend of primary wave C within a cycle degree wave IV.

Within primary wave C intermediate waves (1) through to (3) are complete.

Intermediate wave (4) so far has lasted a Fibonacci eight weeks and may now be complete. Intermediate wave (2) lasted three weeks and was a deep 66% zigzag. Intermediate wave (4) is shallower at 42%.

I would want to see some confirmation of this wave count before having confidence in it. For confirmation I will look for:

    1. A red candlestick for the current session.
    2. Movement below 1,384.60.
    3. Movement below the channel on the hourly chart.
    4. Movement below the channel on the daily chart.

At 1,151 primary wave C would reach 1.618 the length of primary wave A. At 1,101 intermediate wave (5) would reach 2.618 the length of intermediate wave (1).

Within intermediate wave (5) no second wave correction may move beyond the start of the first wave. This wave count is invalidated with movement above 1,423.92.

*There is a problem with the data I am using from FXCM. On the daily chart the price point at which minute wave iii within minor wave C within intermediate wave (4) begins is 1,315.92 (14th August, 2013). This makes minute wave iii 68.71 in length. Minute wave v is 68.64 in length, just shorter, so the core Elliott wave rule that states a third wave may not be the shortest is met. However, on the hourly chart there is no low of 1,315.92 on 14th August, 2013, instead the low there is 1,316.05. This makes minute wave iii as seen on the hourly chart (below) 68.54 in length, which is 0.10 shorter than minute wave v (and minute wave i is 71.20 long).

GOLD Elliott Wave Chart Hourly 2013

This wave count agrees with MACD, the strongest momentum is within the third wave. There is classic divergence with price trending higher and MACD trending lower, indicating a possible trend change here.

Within minute wave v there are no adequate Fibonacci ratios between minuette waves (i), (iii) and (v).

Draw a parallel channel about minor wave C. Draw the first trend line from the lows of minute waves ii to iv, then place a parallel copy upon the high of minute wave iii. When this channel is clearly breached we shall have some confirmation of a trend change.

Movement below 1,384.60 would invalidate the alternate below and provide some price confirmation of a trend change.

Alternate Wave Count.

Gold Elliott Wave Chart Daily alternate 2013

If we simply move the degree of labeling within recent movement within intermediate wave (4) all down one degree, this structure may be incomplete.

Minor wave C may be incomplete and minute wave iii within it may be extending.

This wave count resolves the problem of the length of minute wave iii within minor wave C being 0.10 too short on the hourly chart, but it still leaves the problem of inaccurate data!

At 1,441 minor wave C would reach equality in length with minor wave A. Minor wave C may overshoot the parallel channel containing intermediate wave (4).

Within primary wave C intermediate wave (4) may not move into intermediate wave (1) price territory. This wave count is invalidated with movement above 1,672.77.

Gold Elliott Wave Chart Hourly alternate 2013

If minute wave iii within minor wave C is extending, then within it minuette wave (iii) is just 0.06 longer than equality with minuette wave (i).

Minuette wave (iv) is likely to be incomplete. It may not move into minuette wave (i) price territory. This wave count is invalidated with movement below 1,384.60.

We may draw a parallel channel about minute wave iii: draw the first trend line from the highs of minuette waves (i) to (iii), then place a parallel copy upon the low of minuette wave (ii). Expect minuette wave (v) to find resistance at the upper edge of this channel.

This wave count would be confirmed with movement above 1,384.60.

The biggest problem with this wave count, and the reason why it is my alternate, is that it does not agree with MACD. The first wave within minute wave iii has stronger momentum than the middle of the third wave.

GOLD Elliott Wave Technical Analysis – 26th August, 2013

Last analysis of gold expected an end to a fourth wave correction to be followed by a sharp upwards thrust to about 1,399.73. This is what happened.

The question now is, is this intermediate degree correction over? Have we just seen a trend change back to the downside for gold?

Click on the charts below to enlarge.

Gold Elliott Wave Chart Daily 2013

This daily chart focuses on the new downwards trend of primary wave C within a cycle degree wave IV.

Within primary wave C intermediate waves (1) through to (3) are complete.

Intermediate wave (4) so far has lasted eight weeks and may now be almost complete. Intermediate wave (2) lasted three weeks and was a deep 66% zigzag.

When the structure on the hourly chart is complete then we need to look for confirmation that intermediate wave (4) is over. If this current daily candlestick closes down, is red, that shall be a strong indicator of a trend change.

When we have confirmation on the hourly chart that we have seen a trend change then I will add to the target calculation for primary wave C at intermediate wave degree. I may be able to do this for you tomorrow.

At 1,151 primary wave C would reach 1.618 the length of primary wave A.

Within primary wave C intermediate wave (4) may not move into intermediate wave (1) price territory. This wave count is invalidated with movement above 1,672.77.

Main Hourly Wave Count.

GOLD Elliott Wave Chart Hourly 2013

This hourly chart a good overall look because within minute wave v minuette waves (ii) and (iv) are nicely in proportion.

Draw a parallel channel about minor wave C using Elliott’s second technique. Draw the first trend line from the low of minute wave ii (you can see this on the daily chart) to minute wave iv, then place a parallel copy upon the high of minute wave iii. Expect minute wave v to end mid way within this channel. When this channel is breached by downwards movement we shall have trend channel confirmation that minor wave C is over, and intermediate wave (4) is extremely likely to be over.

Minute wave iv ended as a zigzag with a slightly truncated C wave, not as a triangle. Within the zigzag subminuette wave b was a time consuming double combination.

Minute wave iii is slightly shorter than minute wave i. This limits minute wave v to no longer than equality with minute wave iii at 1,423.84.

At 1,416 minuette wave (v) would reach equality in length with minuette wave (i).

If minuette wave (iv) is not over and continues further sideways then it may not move into minuette wave (i) price territory. This hourly wave count is invalidated with movement below 1,381.94.

Alternate Wave Count.

GOLD Elliott Wave Chart Hourly 2013

It is possible to see a completed five wave impulse for minute wave v. We may have just seen a trend change at intermediate wave degree.

There is no Fibonacci ratio between minor waves A and C.

Ratios within minor wave C are: minute wave iii is 2.62 short of equality with minute wave i, and minute wave v has no Fibonacci ratio to either of minute waves i or iii.

Ratios within minute wave v are: minuette wave (iii) has no Fibonacci ratio to minuette wave (i), and minuette wave (v) is 1.23 short of 0.618 the length of minuette wave (iii).

We need to see confirmation of this trend change before having confidence in it.

Firstly, movement below 1,381.94 would provide initial indication this wave count may be correct.

Second, movement below the parallel channel here on the hourly chart would provide trend channel confirmation that minor wave C is over and the next wave is underway.

Third, movement below the parallel channel on the daily chart would provide channel confirmation that the zigzag of intermediate wave (4) should be over.

Finally, price movement below 1,348.27 would provide confirmation that the upwards movement labeled intermediate wave (4) is a three wave structure and is corrective, because at that stage downwards movement may not be a fourth wave correction within an unfolding impulse upwards.

GOLD Elliott Wave Technical Analysis – 21st August, 2013

Last week’s analysis expected more upwards movement from gold towards a short term target at 1,431. Price did move higher but has fallen well short of the target.

Click on the charts below to enlarge.

Gold Elliott Wave Chart Daily 2013

This daily chart focuses on the new downwards trend of primary wave C within a cycle degree wave IV.

Within primary wave C intermediate waves (1) through to (3) are complete.

Intermediate wave (4) so far has lasted eight weeks and it is incomplete. Intermediate wave (2) lasted three weeks and was a deep 66% zigzag.

Within intermediate wave (4) movement should be very choppy and overlapping. At this stage it looks like it may be unfolding as a zigzag because minor wave A subdivides as a completed five wave impulse and minor wave B subdivides as a zigzag. Minor wave C is incomplete.

At 1,441 minor wave C would reach equality in length with minor wave A. This target should be met in another week or two.

At 1,151 primary wave C would reach 1.618 the length of primary wave A. This target is a long term target. When we know where intermediate wave (4) has ended within primary wave C then we may use a second wave degree to also calculate this target, and it may widen to a zone or may change.

Within primary wave C intermediate wave (4) may not move into intermediate wave (1) price territory. This wave count is invalidated with movement above 1,672.77.

GOLD Elliott Wave Chart Hourly 2013

Upwards movement completed a third wave, minute wave iii, within minor wave C. Minute wave iii is 2.62 short of equality with minute wave i. This limits minute wave v to come to no longer than equality with minute wave iii which was 68.58 in length.

Ratios within minute wave iii are: minuette wave (iii) is 1.80 longer than 1.618 the length of minuette wave (i), and minuette wave (v) has no Fibonacci ratio to either of minuette waves (i) or (iii).

Within minuette wave (v) of minute wave iii are: subminuette wave iii has no Fibonacci ratio to subminuette wave i, and subminuette wave v is 0.40 longer than 0.382 the length of subminuette wave iii.

The movement within minute wave iv may be a regular contracting triangle unfolding. It looks like minuette wave (b) within it is completed, and because this is less than 90% the length of minuette wave (a) it cannot be a flat. Because minuette wave (b) unfolds as a double zigzag a combination is unlikely, because the X wave within a combination may only subdivide into a simple three and may not itself be a combination.

If this analysis is correct for minute wave iv then we should expect more very choppy overlapping sideways movement for another day to three as the triangle completes. Following this we should see a sharp upwards thrust as minute wave v completes, which may not be longer than 68.58.

For the triangle to remain valid minuette wave (c) may not move below the end of minuette wave (a) at 1,352.35 and minuette wave (d) may not move above 1,379.29. Although, if the triangle is a barrier triangle then minuette wave (d) may move very slightly above 1,379.29, as long as the B-D trend line is essentially flat. The upper invalidation point for the triangle is not as firm as the lower invalidation point.

Minute wave iv may also be unfolding as an expanding triangle, but the rarity of this structure means the probability is very low.

Minute wave iv may also be unfolding as a combination and the X wave within it may be incomplete. It may also be a more time consuming flat correction with the B wave within it incomplete. I will consider these other possibilities if they show themselves.

What’s clear is this correction is incomplete.

When minute wave iv is complete then I will recalculate the target for minor wave C to end. I cannot do that for you yet.

Minute wave iv may not move into minute wave i price territory. This wave count is invalidated with movement below 1,344.26.

When minute wave iv is completed the lower invalidation point no longer applies.