Below is what actually occurred which is well within EW expectations even if it did dip a bit lower than shown above. The location pointed to by the red arrow below is what I am now currently modeling as the exact end of the great 2011 gold bear. The entire 5 wave count down is now complete under Avi's monster expanded flat correction. Wave two down should be OVER. That means, assuming Avi's model is correct (and I have been siding with him for several quarters now (as you well know) over EWI's very different model) that we are very, very early into a brand new, historically significant monster bull market for gold and silver. This should not just be any old wave up. This should be a 3rd wave up to higher highs than the old $1900 high.
A LOT HIGHER.
What do you think this is going to do for the miners, especially the juniors which are now beaten down 90% from their prior peak (ticker:GDXJ)?
The model above is highly aligned with Avi's public GDX count from this December 2015 article where the chart model below was offered by Avi. Note that after this 5 wave sequence down was completed, it was not just going to be any old bottom. This was going to be "Large Green 2". This was going to be THE bottom. The end of the 2011 golden bear.
Is it any wonder to you why DRD has broken out (as reported in real time in these pages) on no news? Is it just a coincidence that ABX recently broke out (again reported on here in real time) of a major down trend and again on no news?? Did you know that GLD just bottomed at $100.20 which is right in the wheel house of Avi's long standing "$95-$105" Fibonacci pinball range?? By long standing, I mean as in he wrote that while gold was still near $1600 on the way down. In fact, in this article from Dec 2, 2014 he wrote (orange highlight is mine), "As for downside targets, well, nothing has really changed for me in GLD. I have had a target of 95-105 for quite some time, and have no reason to change that expectation at this time. As far as silver, if this wave 1 down does approach the prior lows, then we could even see a 12 handle as a potential target for this wave V.
...
And, as far as GDX, if this is only the first wave down in its 5th wave down, well, let’s say GDX may see a low that can be a little lower in price than silver. Let’s see how this pattern sets up in the coming week, at which time, we can set more accurate targets for downside follow-through. And, yes, I believe those targets could be the buying opportunity of a lifetime."
The low for silver was around $13.80 so it missed the "12 handle" mark by 80 cents but his comment was made when spot silver was trading at around $20 per ozt. Additionally, GDX was around $20 at the time and yes it did end up lower than silver, having recently bottomed at $12.44.
Folks, the odds are now very, very high that the gold bear is:
OVER.
DONE.
FINITO.
Not because of fundamentals.
Not because of a falling dollar (it's at record highs in a dollar bullish rising interest rate market).
Not because of something the fed did or said (Yellen just raised by .25 - that should be dollar positive, gold negative, riiiiiight???).
Not because of legacy TA.
Not because of gut feel.
Not because Jim Cramer likes gold (he doesn't care about it because he is a clueless moron).
Not because some good looking woman on MSNBC is touting it - The networks all think that gold is a pet rock these days.
Not because central banks or China or India is buying or selling it.
Not for ANY of the traditional reasons that people who have no idea what actually moves stocks will tell you.
ONLY because the wave count reads as complete. Period. Add nothing to this and subtract nothing from it. Don't try to rationalize this in terms of news later on when the gold bull becomes clear. Don't try to say that it was obvious on its face for [put newly minted made up reason de jour here]. As I sit here writing this for the benefit of current and future readers, it's not obvious by any means except when seen though the eyes of the Elliott wave chartist.
Importantly, this outcome was modeled in advance, well in advance to be sure, by a very talented EW practitioner. No, Avi is not always right and I have proven that on several occasions by being right in my models when he was wrong. And Elliott waves are not a crystal ball of truth; they are just an odds based herd observation and prediction system. But I think his count is right this time; EWI's count would kill the entire gold industry off.
Nobody is saying this except Elliott wave followers. Avi's guidance was quite clear in December:
But now the odds strongly indicate that it's over.
Buy the 3 wave dip and stop out below GDX $12.40.
As usual I caution that if you are in the stock market or any other form of speculation, including metals and miners, highly understood and beneficial odds are all the prudent gambler can ever ask for. Elliott waves only give odds and never certainties. We are now at a point in the Elliott wave count for gold and gold miners say the odds have flipped long. I'll report in these pages when we have our first confirmation of the reversal.
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