Gold - Consolidating before one last rally...

Looking at the long term picture, Gold is in a clear and well defined uptrend. We are currently testing the upper resistance-line of the channel which has defined the trend since 1999.

From an Elliott wave perspective we can count five waves since the low at 251.70 in August 1999. That should be a warning that we are getting close to the end of the major uptrend.



Zooming in on the last part of the major uptrend (here from wave 4), we again can count a five wave rally, but if my count is correct. We currently are in wave (iv) of wave v of 5, which means we still need one last rally higher towards 1.636, when wave (iv) is done. Wave (iv) could be a triangle, which would set the final stages for a thrust higher in wave (v), which should terminate the major uptrend since August 1999.

Zooming in closer and looking at the final wave v higher from 1,308, we can again clearly see the first four waves (working on the fourth wave), which again calls for one last rally in wave (v) higher towards 1,636, as the ideal target. When the "old" high 1,575.79 is broken the risk of the major top being close at hand will increase dramatic.

For all time-frames there is a clear divergence on my proprietary indicator, which is a warning that an important top is nearby. We also have a clear negative divergence on the MACD-forest indicator confirming the weakening uptrend.

Short term support at 1,444.40 should protect the downside, as a break below here will leave us with an overlap between wave (i) and wave (iv), which is not allowed under the EWP. Therefore a break below 1,444.40 will be a clear warning that we have seen the important top already, but only a break below major support 1,308 will confirm the top.