Elliott Wave 5.0 "Reboot"

Saturday, February 20, 2016

Gold Weekly Chart 2011-2016 Review



This is going to be a posting without a 2011 having a wave position.  There are still far too many variables that I can show you with confidence where we may be at in the big impulse wave structure. 

Another super duper bullish wave count, are so far off that it would be a complete waste of my time to explore.  Also, if a major bottom hit gold in late December it would have ended on a much more pronounced spike. A very long spike would be more like it. Tops blow off and so do bottoms, but this has not happened yet with gold or silver.  

We also have "no" clear impulse decline and since the 2013 bottom gold has produced nothing but overlapping waves. These waves scream diagonal or triangle at us, if anybody is listening. 

My three trend lines are all in parallel to each other which help to define the trend or two stages of a trend. At present gold is hitting hard up against the middle trend line and if there is more power behind this rocket rally, then it must smash the middle trend line with, enthusiasm and even charge up to the top trend line.  

It all sounds good, but there is always the problem for stock mania to return, killing this gold bull market in its tracks.  If this gold rally has been a run to safe-haven then those exact same traders will dump gold as they chase another leg up in stocks.  The general stock market will always supply competition for gold no matter how oversold we may think gold is or was. 

My bullish consensus report is going to run out soon, but last week's report showed that gold only hit a low of 28% bulls which is not low enough to create a super bull market.  We had a high of 49% bulls last week, which is smack dab in the middle and offers no extra insight at all at this time. 

Gold bears have a tendency to come out of hibernation in the spring and very hungry for gold bull meat, but many times they have disappeared and gone into hibernation in the fall, allowing the gold bulls to grow fat and lazy. 

Any potential diagonal 5th wave heading down can crash gold to where it will shock all the contrarians as gold would break out and down from the bottom trend line by a wide margin.  

Sure, I can set the 2011 top with a Cycle degree wave three, but even then the gold bear market would be far too short to be completed.  It took silver to crash for 13 years before it saw a major bottom, which has yet to be broken.  

Now if gold hit a bearish bottom like oil has, you can bet I would be squawking a different tune. 

Wave analysts think that because something travels big and tall or for a long time that it must be a very high degree. This is the furthest from the truth as big and tall only means potential extensions. All extensions are,  is a "lower" degree that came out of hiding. 

I used to run the bottom of 2000 in gold with a Primary degree wave 1-2, which I think is far from reality as we would would see at least 5 waves up in Intermediated degree. I don't think a Primary degree wave 1-2 would require a magnifying glass to see.