SILVER Elliott Wave Technical Analysis

By: Lara Iriarte | Mon, Jan 13, 2014
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Last analysis of Silver expected more upwards movement which is what we have seen. The short term target at 20.415 for the end of a third wave was almost met, and the third wave ended just 0.047 short of the target.

The wave count remains mostly the same. I will adjust the degree of labeling within the most recent movement and the target to better fit with the bigger picture.

XAG/USD - Daily Chart
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Minor wave B is now a complete zigzag, which is within a bigger zigzag trending upwards one degree higher for intermediate wave (B).

Price movement above 20.489 would provide confidence in this trend change. At that stage upwards movement could not be a second wave correction within the final fifth wave down of minuette wave (v), and so minuette wave (v) would have to be over.

Further upwards movement above the pink parallel channel would provide more confidence in this trend change. A clear channel breach with a full daily candlestick above this channel and not touching the upper trend line would provide this confirmation.

At 25.49 minor wave C would reach equality in length with minor wave A. Minor wave C should find resistance at the upper edge of the big blue channel about this large zigzag.

Minor wave B ended in 88 days, just one short of a Fibonacci 89. Minor wave C should last about 34 to 89 days, depending upon what structure it takes.

Minor wave C must subdivide into a five wave structure, either an ending diagonal or an impulse. An ending diagonal would be more time consuming. An impulse would be faster and is more likely as it is a more common structure.

Within minor wave C at 23.971 minute wave iii would reach 2.618 the length of minute wave i. This higher target fits with a more common expectation of an extended third wave, and so the final fifth wave may reach equality with the first.

Within minute wave iii I would expect to see its second and fourth waves, minuette waves (ii) and (iv), show as red candlesticks on the daily chart.

Within the new upwards trend no second wave correction may move beyond the start of its first wave. This wave count is invalidated with movement below 18.585.

XAG/USD Hourly Chart
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I have moved the degree of labeling within minute wave iii all down one degree. Within minute wave iii I expect that only minuette wave (i) is nearing completion.

Within minuette wave (i) subminuette wave i is exactly 0.382 in length. Subminuette wave iii is just 0.047 short of 2.618 the length of subminuette wave i. This makes target calculation for subminuette wave v difficult, and it may not exhibit a Fibonacci ratio to either of subminuette waves i or iii. At 20.921 subminuette wave v would reach equality in length with subminuette wave iii. However, a more reliable way to see where upwards movement may end for this structure is the parallel channel.

Draw the parallel channel about minuette wave (i) using Elliott's first technique. Draw the first trend line from the highs labeled subminuette waves i to iii, then place a parallel copy upon the low labeled subminuette wave ii. Subminuette wave iv slightly overshot the channel and did not breach the channel. I would expect subminuette wave v to find resistance and probably end about the upper edge of this channel.

When this channel is breached by subsequent downwards movement that shall be confirmation that minuette wave (i) is over and minuette wave (ii) is underway.

I would expect more upwards movement to complete minuette wave (i) in one or two days.

When minuette wave (i) is completed then I would expect a deep second wave correction. Draw a Fibonacci retracement along the length of minuette wave (i). I would expect minuette wave (ii) to reach down to the 0.382 or more likely 0.618 Fibonacci ratio of minuette wave (i).

Minuette wave (ii) should show up on the daily chart as two or three red candlesticks.

Minuette wave (ii) may not move beyond the start of minuette wave (i). This wave count is invalidated with movement below 19.332.



Lara Iriarte

Author: Lara Iriarte

Lara Iriarte

Lara Iriarte

Elliott wave is one of the more difficult and complicated technical analysis tools. When done right it can be uncannily accurate.

I have been using the Elliott wave principle to analyse up to five markets a day since 2008. I began Elliott Wave Forex (originally in 2009 to provide daily analysis of EURUSD and GBPUSD, then I began Elliott Wave Stock Market in 2010. Elliott Wave Gold began in August, 2013. Currently I provide daily analysis of Gold on this site, and daily analysis of the S&P 500 on Elliott Wave Stock Market for its members.

I have a science background (BSc) which has trained me to think logically and be evidence focussed. Over the years I have seen no market movement which does not fit into the clear and restrictive rules for Elliott wave structures.

I have members who are fund managers, institutional investors and professional traders.

If you want to learn how to apply the Elliott wave principle to any market my analysis service is designed to teach you, daily, how to do this.

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