Friday, June 20, 2014

Elliott wave analysis of Gold - A larger triangle is building

Gold larger triangle developing

With the break above resistance at 1,308.00 there can be no more doubt, that a larger triangle is developing. We are currently in the later part of wave e (the last leg of the triangle), but we are not quite there and will have to let the triangle unfold fully before looking for a break out of the triangle.

Wave e of the triangle tend to have a Fibonacci relationship with wave d, so I would look for a move to the 61.8% corrective target at 1,332.15 as the first possible termination-point for wave e, but wave e could move higher towards 1,345 and even 1,356 depending on the strength of wave e.

Short term I will be looking for a correction towards 1,300.55 before the final rally higher towards the first target for wave e at 1,332.15. To indicate that a top is in place a break below support at 1,284.91 is needed and more importantly a break below 1,258.63 confirms the top for a thrust out of the triangle towards the downside for a decline to 1,002 as the ideal downside target.

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  1. Hi,
    Good analysis. Today low is at 1306 and heading slowly to 1332 I guess , but at 1315 as of market close .
    Do you see possibility of reaching to 1332 in coming week and marking end of wave E ?

    Since gold broke out after a long time, I'm sure 1332 should be A of E and a B, C follows before break to 1000 lows.

    Pls comment

    1. Hi Kkandru,

      You most certainly have a point there. I don't know if thee will be time for that (see my post for Saturday).
      But it can't be excluded that more time to develop wave E is needed.

      Kind regards