SP 500 Index & Gold Elliott Wave and Fibonacci Analysis!

In this article, we will present our current primary forecast and analysis on two major markets: the SP 500 index and the Gold futures. The analysis will follow a TDA (Top-Down Approach) covering the long-term Cycles first and then scaling down to minor wave counts. The charts and commentaries that you will find below aim at showing you a practical approach of the Elliott Wave Principle and Fibonacci concepts. (Read more on EWP Core Patterns)

S&P 500 Index - Elliott Wave Analysis of the Secular Bull Market (Log-Scale)

In the following chart, you will find the Cycle degree analysis considering the log-returns of the index from the year 1871 to today. All the relevant comments are posted within the chart:

Now, let’s scale down and focus on the period from 2009 till today and try to grasp investors’

sentiment and possible turning points.

S&P 500 Index - Elliott Wave Analysis (2009-to-date / Weekly Log-Scale)

We are currently trading at the end of the Cycle wave III which may still take a few years more to complete, of course, as long as we don't see SP 500 breaking below the 4300 support before reaching the upper-end of the log-scale channel first.

S&P 500 Index - Elliott Wave Analysis (2020-to-date / Weekly Log-Scale)

In this last chart, we have scaled down to shorter periods analyzing the current wave

developments of the SP 500 to a minor degree. All relevant comments are provided on the chart below:

Gold Futures - Elliott Wave Analysis of the Monthly Chart (Log-Scale)

In this monthly chart, we have attempted to analyze the wave cycle of Gold from 1975 till today. It is worth noting that the Cycle Wave V target at 6220 is a bit far fetched at the present, however, we have merely outlined the fact that at that level Wave V = Wave I in terms of %. As a guideline, we know that the 5th wave is usually the most extended one in Commodities, therefore, it will be interesting to see how Gold will turn out in the next 10 years.

Gold Futures - Elliott Wave Analysis of the Weekly Chart (Log-Scale)

In the following chart, we will review the bullish view for Gold from 2016 till today. The

extensions for the bullish view give us a maximum target of 3155 (see chart below):

Gold Futures - Elliott Wave Analysis of the Daily Chart (Log-Scale)

Scaling down to the Daily timeframe, we expect the Gold price to push lower one more time and finish wave E of blue “4” at 1730-1720 support range and from there slowly push higher for a breakout to the upside, above the 2k mark.

The only concern we have about the bullish view in Gold price for 2022-2023 is the Fed fund

rate hike which is now projected to be increased 4x in 2022. The popular “belief” is that there is a negative correlation between the Fed Fund Rate and price of Gold, nevertheless, further research shows no such correlation; in fact, according to Investopedia articles, “the correlation between interest rates and the price of gold over the past half-century, since 1970, has only been about 28%, and is not considered significant.” (Source)

Gold Futures - Elliott Wave Analysis of the Weekly Chart (Log-Scale) / Bearish Alt View

If Gold fails to hold the 1720 support (see chart above), and makes its way of dropping below

the 1680 mark then the odds of the alternative bearish view will increase dramatically. We are prepared to shift bias once this view is confirmed (see chart below):


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Impulsive Wave Trading Team

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