Thursday, December 15, 2011

12/15/11 - Shiny Yellow Metal

I'm going to talk about gold today.


It looks as if gold is in a significant correction in an overall secular bull market.  This is the left-hand count.  Based on the length of the waves, we probably had a top of at least Intermediate degree.  (If it was an Intermediate (5), of course, then a Primary wave down is now underway and the right-hand count is in effect.

The main point of order is that the late-August/early-September move in gold looks like a "three" rather than a "five".  StockCharts does not show intraday on precious metals, but I have trouble counting it as five waves in the absence of any intraday data.

These charts suggest there is still more downside in gold to come, even if it's just a correction.  How far?  Well, the channel parallel to 1917-1804-1767 and crossing through the Minor A (if it is that) low at 1535 currently is in the 1430s.  If there's an overshoot, and/or Minute [iv] lasts a while, it could theoretically see sub-1400 before turning back up again (either in the next leg up of the bull market, or in Minor 4 of a new bear market.)

1 comment:

  1. your left side count is my count and I strongly believe it to be correct. In the bigger picture, this is minor 2 of P3 up in gold. I have very similar targets as you do, with my favorite being 1415. Numerous methods utilized on both short and long charts point to the same range of high 1300s to low/mid 1400s.

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