Elliott Wave Analysis of Gold

One of the key reasons why Elliott Wave Analysis scores over other approaches to the market is because you are able to tell with a reasonable degree of confidence ‘where’ we are in the market’s progression. Just as we were able to identify a sizeable decline in Gold from the 1895/1925 window, so also we were able to tell in advance that from near 1695 Gold was likely to stage a recovery. The actual high and low was 1911 and 1702 respectively.

Our major objective for Gold, identified in the August 21 Elliott Wave update, remains 2055. However, knowing that we are mere mortals in front of the market, we should seek additional clues along the way. Elliott has some strict rules, and one of them is in an impulse wave, Wave 3 should not overlap the top of Wave 1. As you can see from the attached chart, we are going up as a third wave, and equality measure for the third wave lies exactly at the prior top of 1911. Should Gold fail there for some unexpected reason, and come back and trade below 1835 (the first wave top), then we will say that the prior top was indeed the end of a major move, and what we just saw was a flat correction that unfolded in 3 waves. The implication is Gold will then travel quickly lower. While we stay above 1835, then, we should continue to be optimistic about the possibility of Gold reaching 2055. We shall, of course, fine tune that target as we go higher.

I suggest that you revise the sections dealing with fifth waves in my book and follow this interesting development as it unfolds. Good luck.

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    1. Deepak, anything and everything is possible. We have to study the internal waves of the third (?) wave and determine where it could end. Later on we might change our mind and label this third wave as a C wave if it fails without completing a 5 wave pattern and comes under 1835 directly. Be flexible. But be knowledgeable.

  1. Dear Ramki,

    The decline from 1912 to 1703 looks like a 5 to me. So I suspect this might fail under 1911 or probably has failed. What do you make of the decline from 1912 to 1703?


  2. Sir ,
    i think we are in irregular correction…which usually comes after extended 5th.
    so C can travel upto 200% of A ( to 2030 Approx)
    pls advice…:)


  3. Hi Ramki,

    Interesting observations once again. Cheers!

    I, for one, after paying once again an attention to the monthly charts(was into weekly charts more often) and counting the waves; think that we are actually in the III wave of the entire move. What we may see is the correction in the entire wave 3 (from lows of 542.5 to the current highs) towards perhaps 1490/1400 levels initially and when the 4 wave ends with a confirmation, it would set the campaign for the 5th bull wave effectively to the higher highs. In short, we are in the sub-wave-5 of the Wave-3 in the entire move. The expected correction may set an oncourse in Wave-4 which is considered to be another good level to buy and hold till the completion of Wave-5. Wave-5 could see new highs and more higher than current swing highs. So, I am not calling it a complete ceiling or bubble yet. I could be wrong in my counting as well and could end up being caught in the probable bubble burst, but I would definitely want to check it with you.

    What do you reckon, Sir?


    1. Hello NIck, What you have outlined is certainly a possibility. However, I would prefer to deal with the current moves and immediate future, and revert to your suggested count as we approach those supports. This is the whole beauty of Elliott Wave Principle. If you understand how to USE it properly, it gives you an edge in the market that is so essential to succeed.

  4. Hi Ramki,

    The overlap of 1835 brings an irregular correction possibility with B ended at 1920 and we are seeing C of 4 which will go below the 1700 Low.

    Pls comment.


  5. So gold has broken the key level. Do you think this was a b wave and now we are in a C wave,iv down? Any idea how far wave 2 in c will retrace.

    1. Hi Mohan, at present I am not offering such recommendations. When I say 1855 as the likely top of a range, you must give it a couple of dollars room, especially because of current market conditions

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