close icon

Gold Price Followed Its Elliott Wave Path to $1300

Gold’s third consecutive week of gains led the price of the yellow metal to the vicinity of the psychological $1300 mark earlier today. On December 14th, the price of gold fell below $1233, but according to experts, a combination of economic uncertainty, trade worries and rising interest rates sparked fear in investors, who hurried to buy safe haven assets.

The truth is, every time gold rises, some kind of a safe haven buying is usually going on. Therefore, it is very easy and convenient to explain a surge in gold prices after the fact, but hardly anyone expects it in advance. The problem is that traders cannot profit from yesterday’s gains. In order to succeed they have to be ahead of the market, not behind it.

The Elliott Wave Principle can be very helpful for that same task. For example, take a look at the chart of gold below. Our subscribers received it before the market opened on Monday, December 17th, 2018. As visible, gold’s current surge is the result of an Elliott Wave setup from three weeks ago.
Gold Elliott Wave forecast December 17
The bigger time frames, which are also included in our analyses, suggested that $1300 was a reasonable target for the bulls. The 2-hour chart of XAUUSD revealed the details of the structure of the entire recovery from the bottom at $1160 in August, 2018. There were two impulsive rallies in waves A and 1, followed by two corrective pullbacks in waves B and 2, respectively.

All this made us think the recovery from the bottom of wave 2 at $1196 represents a sequence of first and second waves within wave 3 of C. Since the third wave is usually the fastest and strongest part of the impulse pattern, it made sense to stay with the bulls at least as long as $1211 was intact. The rising trend line drawn through the last three lows also supported the positive outlook. At the start of 2019, gold is already knocking on $1300.
Gold prices climb to $1300 in Elliott Wave fashion
Gold headed north right away and never came even close to $1211. Depending on how you look at it, three weeks can be a lot of time, but that is what it took for this trading setup to bear fruit. Elliott Wave trading is based on price patterns, which take some time to develop. Therefore, patience is required for these patterns to give results, as well.

In this respect, Elliott Wave traders fall into the “position traders” category, because they are willing to keep a position open for days and weeks. In addition, Elliotticians do not rely on external factors such as news, events or announcements by politicians. We prefer to extract information from the market itself. In this case, it was sending a bullish message long before gold’s “safe haven” status became fashionable in the media again.

What will Gold bring next week? That is the subject of discussion in our next premium analysis due out late Sunday!

Stay informed with our newsletter

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

Privacy policy
You may also like:

Famous Pattern Put Gold Traders Ahead of the Curve

Last week, gold finally broke out of the consolidation it has been locked in for almost a month. The price fell to $1400 before rising to $1453 on Friday, July 19th. But instead of maintaining the positive momentum, the bulls lost steam and allowed the bears to close the weekly session at $1425.66. Fortunately, a…

Read More »

Silver Looking for Support near $15 Mark

A little over a month ago, the price of silver was hovering around $16 following a strong rally from as low as $13.90 in November 2018. Many traders saw this 15% surge as a sign of even better things to come. Unfortunately for them, yesterday an ounce of silver was switching hands for about $15.…

Read More »

In Gold ‘s Elliott Wave Footsteps from 1200 to 1350

Gold bulls can be very pleased with their progress in 2019 so far. Three days ago, the precious metal climbed past $1346, bringing its total year-to-date return to 5.2%. Furthermore, gold is up 12.6% from its mid-November low at $1196. “Uncertainty” is once again the usual reason people use to explain gold’s surge. Trade war…

Read More »

Silver Entering Bearish Reversal Area

The price of silver fell to as low as $13.90 on November 14th. It has been recovering ever since and is trading above $15.90 as of this writing. This means silver has gained over 14% in just two and a half months, making it one of the best investments in 2019 so far. The bad…

Read More »

Gold Tests $1240 Resistance after Elliott Wave Setup

Gold is trading at levels last seen over a month ago, following mixed signals from U.S. and China on trade, Brexit worries and protests in France. The demand for safe haven assets is thought to be increasing at times of political and economic uncertainty, which helps explain the surge in the price of gold. On…

Read More »

Gold is a Bad Inflation Hedge. Still Watching CPI?

Similarly to crude oil, gold did not start November in the best possible way. The price of the yellow metal reached $1237.50 on the first day of the month, but was down to $1196 by November 13th. Unlike crude oil prices, however, bullion managed to reverse the negative trend and bounce up to $1230 yesterday.…

Read More »

Gold Prices Under Pressure Amid Easing Tensions

North Korea’s Kim Jong-un appears to have finally come to his senses. The isolated communist country announced it will discontinue its nuclear tests and close down its test site. The North Korean leader will meet with U.S. President Donald Trump in June to discuss the Asian country’s complete denuclearization. And while peace in Syria is…

Read More »

More analyses