Elliott Wave Analysis of Gold after sharp downmove

Elliott Wave Count for GoldThe sharp move down has all the characteristics of a move that starts after completing an extended fifth wave. Our target should be wave ii of the extended fifth, which lies at 1478. Having come down to 1626, the 23.6% retracement level of the whole five wave rally, we are likely to pause here, and certainly I think there is good support near 1575 which is a good place to think of a counter trend trade. Strong resistance comes at 1790 now.

It might be helpful for some to consider why I was reluctant to confirm a top in Gold was in place at 1920. This is explained in the post of Sep 8th. My approach to trading is to be exposed when the risk of error is low. A conservative approach would make us miss some very nice moves like what just happened. That is the price of survival! It does seem now that the move to 1920 was not 3 waves, but a five-wave affair. See the hourly chart to the right. Every now and then, we will witness situations where it is possible to count waves differently, and both scenarios appear equally appealing. When we reach such a ‘fork-in-the -road’ it is best to find a shady spot and rest while we wait for someone who knows the road to tell us which way to go.

This someone is usually an armchair analyst who doesn’t trade, but made the right call and so wishes to publicize that fact. (Someone who traded and lost money will not tell others, and an experienced trader who made money knows that his next trade could be wrong, and anyway he doesn’t care for being right. He only wants to have good trades, and so he will not tell us). But the best teacher is the market itself. If we arm ourselves with sufficient knowledge of the Elliott Wave Principle, we can make adjustments to our count, and get ready to trade the next move with low risk! That should be our goal, and it is the mission of Wave Times to help you acquire that knowledge and skill set. Good luck all.

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  1. Thanks for your wonderful update on the latest position on Gold. And yes I love these words the most…”When we reach such a ‘fork-in-the -road’ it is best to find a shady spot and rest while we wait for someone who knows the road to tell us which way to go.” Thanks Ramki Sir and God Bless you.Best Regards.

  2. hello mr. ramki, is a long term low more likely to be established at your black wave ii target or blue wave (2). you have an extension within an extension so im not sure which target is more valid? i’m trying to find a reasonable level to buy some gold. regards, nadir

    1. Farad, trust me, it is never easy to catch the top. Even when you do, you are still doubting yourself! In the final analysis, we hav to trust our judgement and pull the trigger, always having a stop!

  3. Greetings. Have appreciated your analysis–very insightful. And thanks for reminding about Sept 8th post. Are you suggesting a long term top at $1920? Any thoughts on what would confirm/negate this count?

  4. dear sir ,thanx for yaour update.in longer time gold have a extended 5 th wave ,it mean gold once again comes to 1155 . where 2nd wave of large extended 5th. pls tell me if i am right.

    1. Harsh,

      Ramki has clarified above that we must first concentrate on the level 1478 which infact is the present target being wave ii of extended 5 within extended 5th.

      The next target can be wave 4 which coincides with 50% retracement and below that wave (2) of the extended 5 which also happens to be 61.8% retracement, almost 1193 as suggested by you.

      But for now one level at a time.

  5. Dear Ramki,
    This post(which i liked the most thus far…no not because its on gold) is an example of what makes Wavetimes different from other noisy blogs/views where you hardly find any useful lesson that you can takeaway or learn from a post that you can remember for a long time if not for ever.
    Blind trading equivalent to gambling(we all know that it is to a large extent) and while getting good cards in this game is one step(you need a bit of luck here), “our decision” as to when to take a hit, or when to withdraw or standby from the game is what makes us different from the larger crowd, which enhances our changes of success(luck doesn’t always favor every time). You are truly helping us in enhancing this decision power in true elliott wave sense-taking shots when you tend to get a higher degree of confidence on where the target is going to move next rather than shooting in dark 🙂

    PS: I have loaned(bought) your wisdom(the book) and have started learning(reading) through it, so the sail is ON….

    Best wishes,

  6. Hello Ramki, I’m wondering how the price action in Gold (since July) affects the previous suggestion of yours that Gold would/could retrace it’s fifth wave extension and return to approx $1155? No longer applicable?

    1. Hi Bob, It all depends on what your count is for the five waves from 680. If you think the extended fifth started from 1044, and you count the wave ii of the fifth to be at 1156, then we will eventually get there! You will observe a certain harmony between all the internal waves, and sometimes you could be excused for labelling a wave incorrectly because of a perceived fibonacci relationship. I prefer to take this one step at a time.

      1. this correction will have to be a zigzag to reach 1156. using your method of calculating targets i can estimate current wave A on the daily chart will end just below 1500 (1494?) assuming wave 4 will end at 1734… worst case B retraces 61.8% of A. from that point, all we need is (138% of A) wave C to reach the wave ii target. regards, nadir

  7. Dear Sir
    I have purchased your book .Its very nice really very good wealth for me.My Question Is it possible that gold could move up from 1642 towards 1740-1750 I Captured a triangal breakout.
    please guide us about this possiblity.

  8. hi, yan
    pls tell me that which software you use for these analysis.i serch from a long time . and these counts may be right but not sure because ramki sir clear that many times here that there are always possiblities of any other counts.
    thanx in advance.

    1. Hi Harsh, I am not sure what do you mean by ‘software’. I use standard MT4 Forex platform. and these wave counts were created manually by me. there is no software.

  9. Dear Sir,

    Any New Update On Gold & SILVER.

    Sir I Purchased Your Book & Started Reading , Hope Learn Something New In Book.


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