close icon

Gold or How to Predict a Brexit

Gold is considered to be a “safe haven” in times of uncertainty. So the common logic says that when something totally unexpected happens, such as Brexit, panicked investors buy gold to protect themselves from the falling prices in other markets, thus causing the price of the yellow metal to surge. So far so good. The problem is that such explanation can only be given post-factum – after the unexpected event has happened and after gold has already surged. It seems like there is no way for traders and investors to expect and prepare for the rise, since there is no way to predict the event, which is claimed to have caused it.

When Britain announced it wants to leave the European Union on Friday, June 24th, its decision came as a complete shock. As a results, safe haven seekers rushed to buy gold causing its price to skyrocket from $1250 to $1358 in less than 8 hours. So if no-one saw the Brexit coming, no-one could have expected that gold is going to fly, right? Well, almost no-one. Our premium clients did. They were sent the following chart of gold on Monday, June 20th.
brexit gold daily 20.6.16
As visible, the Elliott Wave Principle suggested we should be ready for a small pullback in wave (b), followed by another strong rally to a new multi-month high in wave (c). You know that most experts and analyst were giving the “Bremain” campaign a substantial lead, so if we were to listen to them, gold’s advance would have come out of the blue for us. Instead, we trust the Wave principle and all we need to make a forecast is a price chart. An updated one of gold is given below.
brexit gold daily flat
It turns out that a forecast made over four days earlier correctly predicted how gold was going to develop during the entire week. No, we did not predict the British referendum result, it came as a surprise to us, as well. We did, however, predict gold’s reaction to it, which is almost the same thing to traders and investors. The Wave principle’s ability to put traders ahead of the news is often unbelievable. While all the world can do is sit and wait for the news, Elliott Wave analysts usually have a clue days in advance. So are you going to just wait for the next “Brexit” to happen?

What to expect from now on? What is the bigger picture saying? Is gold going to continue even higher or the resistance near $1360 would turn out to be too strong for the bulls to breach? Prepare yourself for whatever is coming. Order your Elliott Wave analysis due out next Monday at our Premium Forecasts section. Stay ahead of the news in any market with the Elliott Wave principle.



Stay informed with our newsletter

Latest Elliott Wave analysis on different topics delivered to you weekly.

Privacy policy
You may also like:

Silver Price Going for $19 Before Retracing to $16

The price of silver, otherwise known as a safe-haven asset along with gold, crashed sharply as the coronavirus panic swept equity markets. XAGUSD fell to $11.64 on March 18th just as investors needed a refuge the most. But the precious metal has appreciated significantly since the depths of the selloff. As of this writing, silver…

Read More »

Gold is Crashing. Elliott Wave Somehow Predicted It

Common sense dictates that in a time of crisis demand for safe-haven assets jumps. The price of gold, for instance, the most sought-after asset in difficult periods, climbed to an all-time high of $1921 shortly after the 2008-9 market crash. This time though, as the world economy is on the verge of grinding to a…

Read More »

Gold Fails as a Safe Haven Amid Coronavirus Panic

The S&P 500 was down 14.4% for the week at one point Friday on fears the coronavirus outbreak is going to become a worldwide pandemic. It is common knowledge that investors turn to gold when stocks and other risky assets decline. Last week, however, that wasn’t the case. While stock markets around the globe were…

Read More »

Silver Bears Discouraged by Fibonacci Encounter

We last wrote about silver in March 2019, when the precious metal was hovering slightly above $15. Our analysis of its 4-hour chart gave us plenty of reasons for optimism. And indeed, six months later in September the price reached $19.65. Currently, silver is trading near $17.75, up from $16.53, but still down from that…

Read More »

Gold ‘s Surge and US-Iran Have Little In Common

Gold climbed to a six-year high on rising tensions between the US and Iran following the assassination of Iranian General Qasem Soleimani. The safe-haven asset reached $1590 earlier today as #WorldWarThree started to emerge on Twitter. We hope WWIII remains just a hashtag. In the meantime, we are once again baffled by how the media…

Read More »

Gold Traders Better Off Ignoring the News

In our previous article about the precious metal readers saw how the Elliott Wave principle put us ahead of gold ‘s $72-decline from $1531 to $1459. In short, the hourly chart made us think a three-wave decline from $1555 was still in progress. Hence, the bears remained in charge and more weakness could be expected.…

Read More »

Explaining Gold ‘s Weakness With Elliott Wave Logic

Gold bulls suffered in four of the last five daily trading sessions. A week ago, on September 24th, the price of gold briefly exceeded $1535. Earlier today, it touched $1459 before recovering to $1466 as of this writing. In the meantime, global economic growth is slowing and several recession indicators are flashing red; In what…

Read More »

More analyses