I haven't published much on GOLD recently, but I realize a number of readers follow it quite closely. It's with good reason I haven't published. The internals have been a bit overlapping and confusing. So, I thought I'd wait for some clarity as GOLD bumps up against it's 38.2% retracement of the April to August decline.
The chart below is a four-hour 'close only' chart, and there is a reason for presenting it this way. Again, I would like readers to concentrate on the form, measurements and time signature.
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| GOLD Futures - 4 Hr - Potential Diagonal |
It would help to concentrate first on where the numbered 'five-wave sequences' are. Over on the left, there appears to be a clear five-wave a wave which 'goes nowhere'. That is, this a wave does not break the prior high. Then, there is another clear five-wave c wave up to likely the first wave of a contracting diagonal (i). Parenthetically, one might also note the fifth wave of c of (i) might itself be a small contracting diagonal, as a smaller fractal of the larger pattern.
Next, there is a clear 62% retracement downward - almost to the pip - in a startlingly clear three wave zigzag. Given the exact measurement, this is likely wave (ii).
This is followed by another a, b, c wave sequence up to a shorter wave (iii). And it is then followed by a wave that has already overlapped wave (i), up, in the downward direction. So, it it plausible it could be part of wave (iv) in a diagonal wave.
If wave (iv) forms as a nice zigzag, and there is a subsequent higher high, or near higher high then the potential exists for the proper completion of a diagonal.
Diagonals can be leading or ending. If a fifth wave zigzag forms, and it truncates - does not make a higher high - then almost certainly the pattern would be a contracting ending diagonal. If the fifth wave makes a higher high, then a guessing game begins between ending diagonal - which usually has the higher odds - or a leading diagonal, which is somewhat more rare.
And to focus on the time signature, note that wave (iii) is shorter in time than wave (i). So far, the pattern is fitting nicely in all aspects.
Part of the reason I have posted this chart is so that skeptics and cynics alike can see that using Elliott wave properly to analyze markets is not always like wandering around in the woods with a blind-fold on. Again, the usual caveat that diagonals and triangles are patterns that must prove themselves in every detail. Let's see how the pattern plays out. So, as always, patience, flexibility and calm will best help to analyze this market, too.
Have a good rest of the weekend.
TraderJoe
Hi Joe, thank you for the post. Being that ending diagonals occur in waves 5 and C while leading diagonals occur in waves 1 and A, does that put more weight on this being a leading diagonal?
ReplyDeleteAs I zoom out to daily and weekly charts I cannot see this being a wave 5 or wave C, but rather the start of something new meaning a wave 1 or A since the August low. Is that a fair reasoning to form a hypothesis that this is leading?
Still depends if GOLD weekly is in a triangle or a flat. If the weekly chart was in a triangle, then it is more likely leading. If the weekly chart is still in a FLAT, then it is more likely ending.
DeleteIf it is a triangle why is it more likely to be leading? I think one could make the argument that this wave E of a triangle that is about to break down sub 1000 but on the flip side I think you could also argue that the high in July 2016 is a wave A of an ABC playing out and we are currently in a wave D triangle of wave B, meaning we rally up to 1300-1350 then backtest in a wave E. So confused how that would put weight on a leading diagonal?
DeleteThank you for the explanations. Just trying to learn :)
At 38% of the last decline from April to Aug it could be the c wave of a flat fourth wave. If so. The larger weekly flat could occur. If a larger weekly triangle ended its (c) wave down at the August low, it 'could' be a leading diagonal. But I prefer the former scenario as ending diagonals are more common.
DeleteJoe, I have another solution to offer on the max length wave 2 can be in time relative to wave 1. I just need the time to put it together. It would most likely be a comment of substantial length and I want to make sure it is easily followed when read. I'll need some time.
ReplyDelete13X as long in time is max - thats close to gold in 2000 from my count
Deletesometimes you will get 9X as long in time
Following the 8 fold path it should be around bar 60 to 75 using a 10% margin of error and rounding to the nearest 5 candles. I am on the case..
DeleteJoe this is reply to quantun posts... For decades i have believed the future determines the past...you can see this has been found in the quantun world... So we are at point at time 0. The future will be at time 1 at point B... In a discrete setting we all awake to price b at time 1. now some of us get curious and want to know what path was taken... No one observed so we can agree that many parhs were possible.. Elliot wave becomes the tools of communicating the waves in the quantum world... BUT we kive in a continuous world and prices are observable between a and b... So our observation takes the waves and makes them into particles which are the labels we put on the charts. . Now at some point looking at the trail of particles at a point between 0 and 1 B becomes revealed as the future price in time and space to some of us and we go from not just observers to paeticipants... Thus goes on at different time frames all at once.... When the future prices at times 1 2 3 are monotonically increasing that relays overlapping waves whose waves cancel each other out and thats what leads to fibinacci relationships which are akin to the wavekengths formed in the double slit experiments... So to answer the question how does wave 5 know to stop before it reaches the length of wave 3? I would say at some point at end of wave 2 waves 3 and waves 5 were "not two not one". A three wave move was coming to complete impulse after wave 2 how and if our observation and participation caused smaller to come first is also interesting.. thought i would share some of this with you hopefully i communicated enough to get your interest
ReplyDeleteI need to study this more at length. However on first premise I have to agree on the face of it. How could one have the 'certain' fate of dying, without having been born first?! The future may have 'required' the birth. Spooky
DeleteGuru TJ I have a VIP post to share with the collective but only if you agree. Tried to email you but was undelivered 2 times; mine tonyteo8@gmail.com
ReplyDeleteJoe did u have traderjoe.blogspot.com at one time. Which u closed a year or so ago just wondering
ReplyDeleteHi Rose. No.
DeleteThanks,
ReplyDeleteWelcome Kent.
DeleteThank you for posting this, Joe. In August, I noticed that Gold had appeared to break out of a long term falling wedge (monthly chart). My wave counting skills aren't good enough to determine whether it was a large ending diagonal, but it got me curious. Wedge or ED, if it follows through, there could be an upside for some times to come.
ReplyDeleteShould fiat ccy fail (which I believe it will) then gold will not only revive but thrive until they come up with new store of value
ReplyDeleteWe just broke below the Feb closing low but still need about 36 pts. more to take out the spike low.
ReplyDeleteShowing a nice recovery but not impulsive.
ReplyDeleteLooks like a possible small LD
DeleteLooks like an abc with 535 internals. The question is, is it a correction or part of a larger diagonal?
Deleteabc with failed c
DeleteJoe,
ReplyDeleteI have a degree question. Is it permissible for a larger degree wave to be smaller than a sub wave of a previous wave. ie. can a wave 2 be smaller than subwaves 2 or 4 of the prior wave 1?
..too complicated to visualize or analyze on here.
DeleteSP500 cash - Now under the minute ((b)) wave of the Minor 4 triangle.
ReplyDeleteSP500 cash - Now under the minute ((a)) wave of the Minor 4 triangle. Head & shoulders likely activated.
ReplyDeleteThe weekly Elliott wave oscillator is now outside the bounds of any fourth wave at -49% of the previous peak reading (versus guideline of -40% max).
DeleteHey Joe, was this the acceleration you were looking for? :)
ReplyDelete; )
DeleteThese CNBC interview segments with Jeffery Gundlach are a must watch:
ReplyDeletehttps://www.youtube.com/watch?v=pu9nbpuM9vQ
https://www.youtube.com/watch?v=rbWCNYZVsaQ
https://www.youtube.com/watch?v=I5t18NXcnJM
Joe, has the possibility of an expanded flat has been ruled out? I have wave B (if it's still possible to count it as such) at 152% of wave A (at 2530). I think you said that 150% was the max, but that might have been "about" 150%. Thank you.
ReplyDeleteIf you are counting from the (y) wave of the failure (2807) .. yes. This is primarily because of the failure. If you are measuring A from a different point, what point?
Delete...from 2685; still possible, but probability getting stretched to the limit.
DeleteYes, I'm counting 0 as 2583 on 12/10, a as you indicated and b as 2530. I figured it was stretched to the limit, but wondered if it could be ruled out. So I guess that today it cannot be ruled out, but any move lower than a point or two on 12/18 and the expanded flat is off the table. Thank you!
DeleteVerne, did you go long as per the EW guy you pay? Heh.
ReplyDeleteI had a small long position I exited for a quick profit this morning. I have learned the hard way to never ever trade what other people write, but what I see. Clearly that call for a move today up to 2710 was grossly mistaken. I attend the chart show only weekly so I trust he was able to modify that call with his paying subscribers. He is not the only one. Another analyst I follow has published charts for a week now showing us in an impulse up! Absolutely incredible!
DeleteTo be fair, a possible C wave up to commplete a second wave was a legitimate wave count. What happened today was a lesson in humility and flexibility, whether or not you consider EW a science!
DeleteYou are not the only one as I learned the hard way too. But it’s always a good thing to tune into all sides of the arguments. But try and avoid ‘perma’ types
DeleteHi Joe, once again I must say you are wonderful! If I may ask based on your count what is the projected daily candle count as to when the i of iii to end?
ReplyDeleteSome elliot wave guru's response to a
ReplyDeleteQuestion... "
don’t know why you think a lesser degree correction cannot be bigger than a larger degree
"
Niece hu joe?
Meant nice
DeleteNew post added on the next day.
ReplyDelete