Updated Elliott Wave Analysis of ASA by Sid from ElliottWavePredictions.com. Click on the charts to enlarge.
Back on July 2nd, I posted a workup on ASA Gold and Precious Metals Limited. Since then, ASA has continued lower, and yesterday reached a significant Fibonacci target of $8.94, where wave 5 blue equaled the net traveled by waves 1 through 3 blue times .618. This is the most common Fibonacci target for the length of a 5th wave, so has ASA put in its low? Here’s a new Elliott Wave interpretation of the wave structure since the January 2015 highs, suggesting that ASA is finishing its downward pattern this week.
The new developments in my main Elliott wave count and Hurst cycle analysis are:
1) I’ve found a way to count five waves down from the January 2015 high in the form of an expanding ending diagonal. Wave fives of expanding diagonals are quite aggressive, but constitute the final wave of the pattern. Beware that fifth waves of expanding diagonals can keep going a lot further than logic would dictate, but with COT sentiment on Gold at near record levels of bearishness, we should see a bottom any day. Also note that wave 5 of expanding diagonals must be longer than wave 3 was, and that condition was met at $9.25.
2) Sentient Trader software is now placing a large 4.5-year cycle trough market at the December 2014 low, and not the June 2013 low. This generally means that ASA should move higher, even if the movement is corrective, over the next several quarters at least. This change also altered the placement of the smaller cycle troughs after December 2014. An 80-day cycle trough is due essentially now (July 7 thru July 16), which should be followed by upward movement into the coming 80-day cycle crest, due in mid-August. I think that upward movement into August will be wave 1 of the new upward trend.
As goes ASA, so goes Gold, Silver, precious metals, and the mining sector, although ASA usually leads.
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