0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
EUR/USD
Bullish
Oil - US Crude
Bullish
Wall Street
Mixed
Gold
Bearish
GBP/USD
Bearish
USD/JPY
Mixed
More View more
Real Time News
  • Implementing a trading checklist is a vital part of the trading process because it helps traders to stay disciplined, stick to the trading plan, and builds confidence. Learn how to stick to the plan, stay disciplined, and use a checklist here: https://t.co/2MCG036HGH https://t.co/WvB0ze2Tpe
  • Join @MBForex at 8:30 AM ET/12:30 PM GMT for his weekly strategy #webinar Register here: https://t.co/VAnAfZU02T https://t.co/hCU33zOlyq
  • Heads Up:🇧🇷 BCB Focus Market Readout due at 11:30 GMT (15min) https://www.dailyfx.com/economic-calendar#2020-08-10
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Ripple are long at 96.35%, while traders in US 500 are at opposite extremes with 76.44%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/VJzrlGSkfj
  • Heads Up:🇲🇽 Industrial Production YoY (JUN) due at 11:00 GMT (15min) Expected: -17.8% Previous: -30.7% https://www.dailyfx.com/economic-calendar#2020-08-10
  • Tune in to @CVecchioFX 's #webinar at 7:30 AM ET/11:30 AM GMT for insight on major event risk in the week ahead. Register here: https://t.co/X8TIhpKxtF https://t.co/YZoHo12epc
  • Commodities Update: As of 10:00, these are your best and worst performers based on the London trading schedule: Oil - US Crude: 1.55% Silver: 0.16% Gold: -0.20% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/a6Cpl9NrtM
  • Missed today's Cross-Market Weekly Outlook webinar? See the recording here - https://t.co/5IzIKPVcjn The focus this week was on potential for a broad US Dollar rebound, with an eye on #EURUSD, #AUDUSD and #gold
  • Forex Update: As of 10:00, these are your best and worst performers based on the London trading schedule: 🇬🇧GBP: 0.01% 🇨🇦CAD: -0.01% 🇯🇵JPY: -0.07% 🇪🇺EUR: -0.19% 🇳🇿NZD: -0.21% 🇨🇭CHF: -0.37% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/ZK6i5FuWCO
  • Triangle patterns have three main variations and appear frequently in the forex market. These patterns provide traders with greater insight into future price movement and the possible resumption of the current trend. Learn about triangles here: https://t.co/7FV2JAxssO https://t.co/RqjV3yyClM
Gold Prices Hit 17 Month High; What Does the Wave Analysis Forecast?

Gold Prices Hit 17 Month High; What Does the Wave Analysis Forecast?

2018-01-25 21:31:00
Jeremy Wagner, CEWA-M, Head of Education
Share:

Gold prices recently hit their highest level in 17 months. According to the Elliott Wave principle, this recent break above $1357 indicates we are in a big ‘B’ wave with a gold price forecast of a bearish reversal occurring soon.

Gold Chart Elliott Wave Analysis Talking Points:

  • The gold price break above $1357 elevates the possibility the December 2016 trend to now is a large ‘B’ wave
  • An eventual ‘C’ wave lower may carry back towards $1200
  • A break below $1306 would increase the probability wave ‘B’ is finished and wave ‘C’ has begun

The gold price trends have been sloppy since December 2016. That sloppy behavior is evidence of a three-wave move, a correction. Therefore, the current increase in gold prices may not last long.

The break above $1357 eliminates the near term triangle possibility and indicates the rise since December 2016 is a large ‘B’ wave. ‘B’ waves tend to be sucker waves that are sloppy and overlapping and the trend for the past year fits that description. The Elliott Wave analysis calls for gold prices to remain below $1465.

Bearish Reversal Towards $1200

In the Elliott Wave sequence, once the ‘B’ wave terminates, we can anticipate a large portion of the December 2016 up trend to be retraced. Therefore, the gold price forecast in the coming months would be for a correction down towards $1200. The structure of the sell off would provide us clues as to the depth it may carry. For now, we will locate a generalized target near $1200.

The Elliott Wave analysis for gold prices forecast a reversal below $1465.

Gold Prices Below $1306 Suggests a Top is in Place

Our gold price forecast is for a bearish reversal to occur between now and $1465. Though that is a large region, we can use simple technical analysis to help us enter into the bearish reversal.

For example, a break below $1306 would begin to carve a lower low in gold prices. A successful move below $1306 will allow us to analyze the charts for a bearish 5-3 wave sequence. The bearish 5-3 wave pattern would allow us to use the swing high as a risk level.

One other factor I will keep an eye on is the USD/JPY exchange rate. Gold and USDJPY have been moving inversely to one another until lately. It comes as no surprise that my Elliott Wave analysis for USDJPY has that pair in a complex ‘B’ wave too. On the chart below, I plotted Gold against the inverse of USDJPY and they have been tracking each other closely.

Notice below how gold prices have pushed to new recent highs while the red line struggles to break the September 2017 high. If we begin to see the red line break support (USDJPY reverse to the upside and break resistance levels), then that may be an early warning signal of a looming gold price correction.

Gold price correlation to USDJPY exchange rate.

Elliott Wave and Gold FAQs

What is Elliott Wave Theory?

Elliott Wave Theory is a forex trading study that identifies the highs and lows of price movements on charts via wave patterns. Traders often analyze the 5-wave impulse sequence and 3-wave corrective sequence to help them trade strategically. We cover these wave sequences in our beginners and advanced Elliott Wave trading guides.

Why wait for $1306 before entering short? Wouldn’t you miss the reversal?

Trading is more than entry and exit signals. Account management is as important relative to anything else in your trading. Therefore, as a trader, I am seeking out strategic places on the chart to where I can identify the trend, risk level, and target level that is consistent with the habits of successful traders. Though we are not calling the exact top and reversal point, we are identifying those strategic areas where we have a higher probability to extract a large portion of the trend.

---Written by Jeremy Wagner, CEWA-M

Jeremy is a Certified Elliott Wave Analyst with a Master’s designation. These articles are designed to illustrate Elliott Wave applied to the current market environment.

Communicate with Jeremy and have your shout below by posting in the comments area. Feel free to include your Elliott Wave count as well.

Gold was one of the key markets discussed in a special year webinar “What 2 Watch 4 in 2018”. Register to view.

Follow on twitter @JWagnerFXTrader .

Join Jeremy’s distribution list.

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES

News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.