Elliott Wave 5.0 "Reboot"

Wednesday, December 2, 2015

The Price Of Gold Crumbles Again: 2011-2015 Daily Chart Elliott Wave Count Review



This grinding gold bear market is spitting out gold bull bones on a consistent basis.  The only thing we can do until the US dollar changes its trend, is to catch as many of the turnings as we can.  We also have to constantly review the big picture to see if it will fit into something related to a decent wave count. 

I am still trying to keep the largest top as a wave 3 in Intermediate degree, but I don't know for how long I can keep that wave count. 

After the 2013 crash bottom gold changed its pattern and started to reduce its angle of decline. This throws a monkey wrench into any big trend lines except for a few short lines stretching the last 2 years.  Gold is crashing as I post, but we are also very close to the bottom part of my trend line. If a bigger bounce is going to happen, then gold can bounce from the bottom trend line until it hits the top trend line. 

The mess of overlapping wave structures since 2013 gives me a clue that a potential ending pattern is in progress.  If we are going to get a potential diagonal 4th wave rally, then this rally can go to the maximum of $1300 before it has to crash again. 4th waves in ending diagonals can't go past the wave 2  ending. Not a Penny more as I use a very strict price separation between ending and regular diagonals. 

If by some miracle that this gold bear market is actually ending then it should take out all tops right back to any 2013 peaks.  Normally, gold could head to my top trend line a bit above $1200  and then it could implode one more time to finish off a 5th wave diagonal.  

Hopefully gold will not make a new record low as the decline sure looked corrective in nature.


The gold/oil ratio is sitting at about 25.88:1 which is extreme when using gold as money.  Some flip this ratio and try and use oil as money to figure out where gold is going. There is no comparison which we should use as oil disappears out your car's tailpipe, and I am sure you would never let gold  spit out of your car's tailpipe.  

Some say that oil is going for the new normal and stay below $50, ok, but they are forgetting where the new normal price of gold should be.  At a normal ratio of 15:1 then gold would have to crash to $750 to be normal!