Gold has progressed in the past months, breaking multi-month highs. The following looks at what could happen next based on Elliott wave theory.
February 04, 2019 | AtoZ Markets - Last week, the yellow metal continued the bullish run from 1160. It hit 1335 to mark the highest in the last 8 months. In a time when the Dollar was plummeting after the last Fed rate dovish decisions, Gold is expectedly doing well. However, before the end of last week, price started another corrective dip just as expected. How deep would the bearish correction go? Where will the rally continue?
From Elliott wave perspective, we have looked at Gold prices in the past months with a keen bullish expectation. The run from 1160 was labelled an impulse wave which was expected to to continue the long term bullish corrective run that started in December 2015 (1040). The current rally was expected to continue to 1360-70 before a big dip happens. Gold could be on a truly bullish run throughout this year. Let's step down to the lower time frame.
Gold Elliott Wave Analysis and Important Price Levels
In the last updates, after price broke above 1300 to 1330, we expected a bigger correction back to 1300 or slightly below. The chart below was used in the last update.
Price was just at the brink of completing the third wave of the 1160 rally and we expected the 4th wave to start. Price dropped as expected. How far would the 4th wave dip of this degree go? The chart below shows the new update.
The 3-wave dip is expected to go deeper. Ideally, the 4th wave corrects into the territory of the 4th sub-wave of the 3rd wave. In this case, wave iv of (iii) falls at 1298-1277. Price will most likely hit this zone unless it's being supported at 1300-1298 support zone. Anyways, price should dip further unless a break above 1335 happens. The general trend still points upside to 1360-1370 zone.
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