Both hourly wave counts were invalidated: first the alternate with upwards movement, and following that the main with downwards movement.
Yesterday’s analysis had three hourly wave counts. The main wave count expected upwards movement, and the two alternates expected downwards movement. Price has moved lower but not low enough to invalidate yesterday’s main hourly wave count. All three wave counts remain valid.
Now that there is a little more structure to analyse recent movement is becoming clearer. The probability of yesterday’s alternate wave counts has increased.
Yesterday’s short term target at 1,205 has been comfortably passed, and at the time of publication price is 13.67 below the target.
The wave count remains the same.
Yesterday’s analysis expected a third wave downwards to end about 1,234 to 1,236. The third wave has ended at 1,236.89.
The wave count remains the same.
Click on the charts below to enlarge.
Gold is still within a large fourth wave correction at primary wave degree which is incomplete. It is now more likely to continue as a double combination because within it intermediate wave (X) should be deep.
The purpose of double combinations is to take up time and move price sideways, so I would now expect intermediate wave (Y) to end about the same level as intermediate wave (W) at 1,433.83. Double combinations in fourth wave positions are quite common.
If downwards movement reaches 1,205.74 or below then it would be 90% of the prior upwards movement labeled intermediate wave (W). At that stage I would relabel primary wave 4 as a flat correction, A-B-C rather than a combination W-X-Y.
Within the combination intermediate wave (X) is unfolding as a zigzag. Minor wave C downwards must complete as a five wave structure. At 1,206 minor wave C would reach equality in length with minor wave A. Within minor wave C at 1,198 minute wave v would reach 1.618 the length of minute wave i. This gives an $8 target zone for downwards movement to end. I will try to narrow this zone as the structure gets closer to the end.
There is no lower invalidation point for intermediate wave (X); X waves may make new price extremes beyond the start of W waves, and they may behave like B waves within flat corrections. For combinations X waves often end close to the start of W waves.
I have drawn a parallel channel about the zigzag of intermediate wave (X) using Elliott’s technique for a correction. Draw the first trend line from the start of minor wave A to the end of minor wave B. Place a parallel copy upon the end of minor wave A. I will expect minor wave C to find support at the lower end of this channel, and it may end there.
Primary wave 4 may not move into primary wave 1 price territory. This wave count is invalidated with movement above 1,532.90.
There are several ways to label this downwards wave of minute wave v so far. This labeling has the best fit.
On the daily chart it looks like minute wave v may have entered the fourth wave within it, so this fits with the look on the daily chart.
If minuette wave (iii) is over at 1,236.89 then it is 2.45 short of 2.618 the length of minuette wave (i).
Ratios within minuette wave (iii) are: there is no Fibonacci ratio between subminuette waves iii and i, and subminuette wave v is just 0.34 short of 0.618 the length of subminuette wave i.
The strongest downwards movement is the middle of the third wave. This wave count fits perfectly, so far, with MACD.
Draw a parallel channel about minute wave v using Elliott’s first technique. Draw the first trend line from the lows labeled minuette waves (i) to (iii), then place a parallel copy upon the high labeled minuette wave (ii). I will expect minuette wave (iv) to find resistance at the upper edge of this channel.
Minuette wave iv should show alternation with minuette wave (ii). Minuette wave (ii) was a relatively shallow 45% double combination correction. Minuette wave (iv) may show alternation in depth and / or structure. So far it looks like it may be unfolding as a zigzag which would provide alternation in structure. If it finds resistance at the upper edge of the channel it may end about the 0.236 Fibonacci ratio of minuette wave (iii) at 1,246.71, and show some alternation in depth also.
Minuette wave (iv) may not move into minuette wave (i) price territory. This wave count is invalidated with movement above 1,270.14.
Yesterday’s analysis expected more upwards movement from Gold towards a short term target at 1,298 within one or two days. So far price has reached up to 1,294.43 and the structure is incomplete.
I now expect this fourth wave correction to end within a few hours.
Yesterday’s analysis expected more downwards movement, with a second wave correction along the way. This is pretty much what has happened; price has stepped lower with corrections along the way. The short term target for last analysis was at 1,287. Price has reached down to 1,281.69 so far, but the second wave correction is already over.
Click on the charts below to enlarge.
Main Wave Count.
This is the main wave count with the highest probability. Flat corrections are extremely common structures, particularly in fourth waves. Primary wave 2 was a rare running flat, and primary wave 4 may exhibit alternation if it is a more common expanded flat or a still common regular flat. Primary wave 4 may also exhibit alternation if it is shallow; primary wave 2 was very deep.
Primary wave 2 lasted 53 weeks. It would be likely that primary wave 4 will continue for longer to be better in proportion to primary wave 2.
It is most likely that primary wave 4 is not over and is unfolding as a large flat correction. Within the flat intermediate wave (B) is an incomplete double zigzag. Within the second zigzag of this double, labeled minute wave y, minuette wave (ii) may not move beyond the start of minuette wave (i). This wave count is invalidated at this stage and for some time yet with movement above 1,532.90.
Within the flat correction intermediate wave (B) must be at least 90% the length of intermediate wave (A). This wave count requires more downwards movement to this minimum at 1,205.74.
Within an expanded flat the B wave is 105% the length of the A wave, so this wave count allows for a new low as quite likely, because expanded flats are the most common type of flat.
Intermediate wave (B) would be about three or so weeks away from ending.
Subminuette wave i is already complete, as is subminuette wave ii. Subminuette wave iii is underway, and may possibly have passed the middle. If momentum increases further I would expect that the middle of subminuette wave iii may not be over and may be extending further.
Within micro wave 3 there is no Fibonacci ratio between submicro waves (3) and (1). This makes it more likely we shall see a Fibonacci ratio between micro wave (5) and either of (1) or (3).
At 1,274 submicro wave (5) within micro wave 3 would reach equality in length with submicro wave (1). At 1,276 micro wave 3 would reach 2.618 the length of micro wave 1. I would expect this target to be reached within 24 hours, before next analysis.
When micro wave 3 is complete then micro wave 4 should move price higher. It is likely to be shallow, because micro wave 2 was very deep. Micro wave 4 may not move into micro wave 1 price territory. This wave count is invalidated with movement above 1,300.59.
At 1,257 subminuette wave iii would reach 1.618 the length of subminuette wave i. This target may be about two to four days away.
At 1,209 minuette wave (iii) would reach 1.618 the length of minuette wave (i). This target may be at least a week away.
Alternate Wave Count.
While flat corrections are extremely common structures, multiples are only slightly less common. For this reason this alternate has a lower probability than the main wave count.
This alternate would see better alternation with primary wave 2 which was a running flat; primary wave 4 as a double zigzag would provide perfect alternation in structure.
Within multiples X waves are usually single zigzags, or less likely single flats or triangles. It is unusual for an X wave to be a multiple itself, and this one is a double zigzag. This reduces the probability of this alternate wave count.
Within multiples subwaves W, Y (and if there is one subwave Z) can only subdivide into simple corrective structures, they cannot themselves be multiples. But X waves can, and rarely, do.
Within intermediate wave (Y) no second wave may move beyond the start of the first wave. This wave count is invalidated with movement below 1,277.97.
Alternate Wave Count II.
This wave count has the lowest probability because it would see primary wave 4 as having lasted only 9 weeks. Compared to primary wave 2 having lasted 53 weeks, this lack of proportion gives this alternate wave count the wrong look at the weekly chart level. This significantly reduces the probability of this wave count.
This alternate expects very strong downwards movement as the middle of a third wave unfolds. If the next wave down shows a very strong increase in momentum then I would more seriously consider this alternate.
At 1,174 minor wave 3 would reach 1.618 the length of minor wave 1.
Subminuette wave ii may not move beyond the start of subminuette wave i. This wave count is invalidated with movement above 1,352.90.
The structure on the hourly chart has changed slightly.