Gold eWave Projection

I thoroughly prefer to believe that we are still in the process of completing the third wave up, since short term interest rates remain nominal positive. The correction only lasted a couple of months before resuming, and we still haven't adjusted to a new average price. There are other factors along with the fundamentals such as negative lease rates, which presumes that heavy gold leasing is occurring.

We also have the futures chain which remains in a contango for the moment. I presume that should we see chronic backwardation in gold, that we are probably in the fifth wave up.

http://finance.yahoo.com/q/fc?s=GCG12.CMX

Its interesting nonetheless to see a complete projection of the elliot wave count in gold prices to an extreme. Much has been made of Alf Fields' Elliot Wave projections since they were posted to J.S. Mineset.

Since oil as a commodity is trading at an average of 8 - 10X the value of the low in the 1990's, then its pretty safe to assume a long term average of ~$2500/oz. after the mania blow-off. But with a mania like this, if the calculations are correct, then a long term average of twice that would be appropriate.

Central banks might intervene in the meantime, since a gold price fix would be in order should negative nominal interest rates on short-dated treasuries become policy.

The chart puts the peak value sometime in 2015. This is commensurate with the findings of Realterm.de. (Realterm does not agree in terms of price.)

We'll have to wait for gold prices to settle some first before moving higher, but if we exceed the last rebound high this week, then we're at record prices again shortly.

source: http://www.sharelynx.com/chartstemp/GoldeWave.php

via 321gold.com

-F6