It’s Too Soon To Buy Gold-Elliott Wave Chart

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It’s Too Soon To Buy Gold-Elliott Wave Chart


Hello traders!

After the recent strong and impulsive rally on gold, we can see it slowing down now since the August 2020 high, but with slow and overlapping price action, so we think it’s a corrective wave structure, seen as higher degree wave IV correction. Wave IV can be sometimes very complex, so at this stage, we are observing two counts especially since the USD is trying to recover which may have a bearish impact on metals as well.

 In the first and primary chart below, we are tracking a bigger bullish triangle correction in wave IV), but only if the price stays slow and sideways until we see an A-B-C-D-E subwaves. This is possible if the metal will keep chopping around between around 1850-1900. If not, and if bears will be in charge for the next few weeks with a potential retest of 1765 then secondary count comes in play, where we may see deeper and more complex 7-swing A-B-C-X-A-B-C correction. In such a case 1700 can be a very important level to watch for the next bounce. 

So for now, gold remains very tricky, but what I like about the whole price action down from August highs is that in either case, it’s corrective, we just need more time now before we can decide what type of patter wave four is forming., But eventually, price will be higher later this year. 

If you are looking at gold in EUR, then you should also be aware of potential weakness as the price can be breaking a bearish flag.

XAUUSD 1 and 2

XAUEUR 

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About Author

Grega Horvat Grega is based in Slovenia and has been involved in markets since 2003. He is the owner of Ew-Forecast, but before that he was working for Capital Forex Group and TheLFB.com. His feature articles have been published on FXstreet.com, Thestreet.com, Action forex, Forex TV, Istockanalyst, ForexFactory, Fxtraders.eu, Insidefutures.com, etc. He recently won the award on FXStreet.com for Best Forex Analysis in 2016. At Ew-forecast he helps clients and educates them about the Elliott wave principle and how to label and track unfolding patterns in real time. His approach to the markets is mainly technical. He uses a lot of different methods when analyzing the markets such as candlestick patterns, MA, technical indicators etc. His specialty, however, is Elliott Wave Theory which could be very helpful especially if you know how to use it in combination with other tools/indicators. EW-Forecast To be involved in the market effectively, you need the right guidance and resources, and our team can help you to achieve that. Our team is providing advanced informations about Elliott Wave theory in real time. The Elliott Wave Principle gives you a method for identifying the behavior of the markets and at what points the market is most likely to turn. We help new traders who are interested in Elliott Wave theory to understand it correctly. We are doing our best to explain our views as simple as possible with educational goal, because knowledge itself is power!

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