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Silver Lining Up For Dull Move | $XAG $USD $SILV #silver $XAU

FX:XAGUSD   Silver/U.S. Dollar
2694 65 22
Traders,


ELLIOTT WAVE COUNT:

A L/T look at $XAG suggest a protracted bearish correction in the shape of an Elliott Wave Leading Diagonal, based on:

1 - A deep correction from a 49.780 high reached on April 25th, 2011.

and

2 - Internal alternations of 5-3-5-3-5 waves, identifying the overall pattern as an EW's Leading Diagonal.


PREDICTIVE/FORECASTING MODEL;

Apart for the wave count, the predictive/forecasting model eyes the following target:

- TG-Lo = 9.655 - 20 OCT             2014


OVERALL:

While the scale of the chart might appear difficult to trade to retail traders, the emphasis here is put on a bearish bias that is not simply based on a sustained bearish trend born in 2011, but also on the wave count expectation of a termination at Point-5 and a separate predictive/forecasting model that defines a bearish target at 9.655.

A limited upside exists in the near interim, as price could attempt a shallow rally to 18.191, corresponding to a significant line-up of a then-triple support, turned now-resistance. This interim rally might occur following the recent sustained downtrend that developed since Point-4.

Look for a correlating action in the RSI to confirm these alternative moves between resistance and support in price.

Cheers,


David Alcindor
Predictive Analysis & Forecasting
Denver, Colorado - USA


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Twitter: @4xForecaster
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David Alcindor, CMT Affiliate #227974
Alias: 4xForecaster (Twitter, LinkedIn, StockTwits)

Signal Service or Private Course - Contact: admin@KADAInstitute.com
All updates on https://twitter.com/4xForecaster
Gorgeous charting, as usual. I've been looking at XAG for a long entry for a couple of days now. That low target is really abysmal, wow.
Keep up the great and inspirational work David. Cheers, Ivan.
+4 Reply
20 OCT 2014 - ADDENDUM/Clarification:

Traders,

So that there is no confusion here, the first IMP move I have highlighted corresponds to two separate impulses separated by an internal TZ. However, I have discounted the internals of this first IMP simply because the first internal IMP could not possibly be standing on its own in the face of a dominant bullish impulse.

Instead, this IMP has to be part of a more complex correction, which is why I let it be defined as part of a IMP-COR-IMP which defined Wave-1 - Following is what the internal would look like in Wave-1, compared to its original construction below:


snapshot



snapshot



This might be a bit of a TMI moment here, but some true Ellioticians are certainly going to ask themselves a similar line of reason. and Elliotician-glot I am not. I speak with a strong technical accent too, but one of a geometric dialect at the antipod of the wave world.

Thank you.

David Alcindor


NOTE: I also added a 25.097 level corresponding to a lesser-degree Wave-4, an area that carries a significant structural importance in EWP if and whenever price revisits this level ... It might take a while - David
+3 Reply
Meru PRO
2 years ago
Nice chart. Thank you. Do you have anything similar on GOLD please??
+1 Reply
4xForecaster PRO Meru
2 years ago
@sudhindrakatagade - Thank you. Gold ... I tend to provide larger timeframe analyses on metals, simply because of their dominant influences (i.e.: correlations) over certain Forex pairs. So, you might not always find anything in the M15, H1, or H4, except for this recent $XAUUSD:

$XAU Hit Target @ 1216.67; Limited Rally Into 5-0 Patt. | $Gold


The price action was so distorted that it required that I defined "worst-case scenario" targets at the extreme limits of the predictive model. Still, it provides some insight on what might be happening to $AUD, $CAD, and $NZD.

Enjoy and thank you for following!

David
+2 Reply
LastBattle
2 years ago
Wow. Silver is totally moving like Litecoin.
It had a peak of $48 USD and is now $3.96.
+2 Reply
4xForecaster PRO LastBattle
2 years ago
Hello @LastBattle - Yes, very similar "footprint". Makes you wonder - David
+3 Reply
Sokun 4xForecaster
2 years ago
Gassho David Gassho
Reply
rvg
2 years ago
David, with obvious interest in metals, how high of a probability is your TG-Low of 9.655?
+1 Reply
4xForecaster PRO rvg
2 years ago
Hi RVG!

1 - The target is a nominal one, so the probability is LOWER compared to a numerical target (i.e.: TG-1, TG-2, TG-3, ... TG-n).
2 - However, there are several other influences that support added downside, besides the fundamentals:
a -- Model remains bearish throughout
b -- Pattern calls for a bearish reach to complete the presumed background market geometry
c -- Wave pattern calls for an impulse, forcing price to lower lows.

snapshot


The invalidation condition would require that current price reverses and surpasses the level of Point-3 in the pattern @ 18.191. Added confirmation of a probable failed bearish venture would also come from price breaking and closing above the 2-4 Line. From the model, I would want to see an early market reversal sign first.

OVERALL, the trend remains down and the target based on the model. Combined with fundamentals, geometries and wave count, there is little indication of a bullish reversal at this point.

David Alcindor
+2 Reply
rvg 4xForecaster
2 years ago
merci beaucoup
Reply
tuamen
2 years ago
I Love your chart mate, nice and clean with clear structure and your thesis well articulated. I am not a Elliottian however I posted a weekly chart a few weeks ago with a little different structure, after price broke $18ish level and the .764 fib level drawn from the swing low in late 2008 to the high in early 2011. See Chart here,
Demand Zone and Support Levels for Silve ,( XAGUSD )
Additionally, I placed a fib structure on RSI, with default settings, (borrowed from Constance Brown, Technical Analysis for the Trading Professional) and while I certainly don't want to speak for Connie, this confirmed a extended bearish move and now that we have a sustained move below $18ish I maintain my bearish basis and have identified similar support levels as your Elliott wave count where I would like to start building a long position. I just recently started to follow you and love your charts and analysis; Thanks for sharing!
+2 Reply
4xForecaster PRO tuamen
2 years ago
@tuamen - Thank you for sharing and your generous compliments. Very appreciated. Glad you read and apply some of Connie's work - David
+1 Reply
30 OCT 2014 - Update:

From Twitter:
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$XAGUSD moved per forecast; Now carving new low; 9.655 target remain intact:

snapshot


@tradingview | $XAG $USD $SLV $XAU
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snapshot



David Alcindor
+2 Reply
Sokun 4xForecaster
2 years ago
Gassho David
Reply
Sokun 4xForecaster
2 years ago
Are there any finer time frams that you could share? Gassho David
Reply
03 NOV 2014 - Update:

Traders,

Although the original bearish directional bias remains in force in the WEEKLY timeframe, adverse excursions are bound to occur in smaller frames, offering the M15-to-H4 dweller room to consider opportunities.

Looking at the M15 level, price is wingling itself out of rising wedge. Markers on either side of the geometry could be considered as conservative trigger levels towards their respective nominal targets, namely TG-Lo and TG-Hi.

I recommend staying away from M15 timeframes, as the predictive/forecasting system is best calibrated to perform at the synthetic H4 level (i.e.: where aggregate retail plus institutional action meets). However, if you must respond to some compulsory limbic demands, simply beware.

My interest in the $XAG and XAU remains peripheral to Forex, but I will consider moves in these metals as a correlation force affecting $AUD, $CAD, $CHF and $EUR positively, and $USD inversely.

snapshot


Cheers,


David Alcindor
+1 Reply
IvanLabrie PRO 4xForecaster
2 years ago
Interesting, hopefully the reaction's delayed like what transpired before this big drop (I'm long usdcad...)
Great charts and insights as usual David, cheers.
Ivan.
+1 Reply
Sokun 4xForecaster
2 years ago
Gassho David
+1 Reply
42inciHakan
2 years ago
How does an ounce and silver dollar account?
9655 whilst the number of ounces to be?
+1 Reply
4xForecaster PRO 42inciHakan
2 years ago
Hello @ 42inciHakan - I am not sure I understand your question.

If the question relates to silver/gold correlation, I would not be able to provide any intelligent comment on this. I would refer you to a trader here who brokers these metals. He follows my trades and comments, so I let him take it up from here.

Feel free to repost comment/question if I can be of any help.

David
Reply
Sokun 4xForecaster
2 years ago
Good morning David! Gassho 4 all your wonderful work! Where 2 after we hit 15.29?
Reply
Sokun Sokun
2 years ago
Your finer time frames are great!
Reply
05 NOV 2014 - Update:

From Twitter:
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$XAGUSD hit its bearish target at 15.292; lower-degree #elliottwave correction now in play:

snapshot


@tradingview $XAG $USD
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snapshot



Traders,

As indicated in the analysis, a trigger level had to be reached first before committing price to a directional bias. Here, the lower trigger in the M15 chart was hit where defined, and price rolled to its bearish target.

Looking at a smaller-degree level in terms of Elliott Wave Principles, a correction is underway for the moment (Point-4 is left ghosted). Once this correction is complete, expect an impulsive formation to define the larger bearish impulse (of which points 3, 4 and 5 are defined in purple).

There are several possibilities at this point, but as mentioned before, you may recall that our timeframe of interest here is much larger, wherein an abysmal target dwells in the single digit, as defined by the original predictive/forecasting analysis. Thsi supposes that the "trade winds" generated at the institutional levels remain in force, and any rallying is expected to be limited.

Here is the larger timeframe for reference:


snapshot



Cheers,

David Alcindor
Reply
Sokun 4xForecaster
2 years ago
Any new comments on the recent action? Gassho sincerely David!
+1 Reply
Sokun 4xForecaster
2 years ago
Does touching 15 dollars count as point 5?
+1 Reply
05 NOV 2014 - Addendum:

From Twitter:
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$XAGUSD - Predictive/forecasting model's BEARISH target remain in force at 9.655:

snapshot


@tradingview | $XAG $USD #forex
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snapshot



David Alcindor
Reply
Sokun 4xForecaster
2 years ago
Gassho David. Very insightful!
Reply
42inciHakan
2 years ago
$ XAGUSD - 9655, XAUUSD how many goals?
+1 Reply
4xForecaster PRO 42inciHakan
2 years ago
Hello, @42inciHakan - I am not sure I understand your question. What do you mean by goals? This is a $XAG thread. Feel free to look up the $XAU thread I posted in the recent past, where a single target is defined. Feel free to elaborate on your question within the $XAU thread. I will do my best to answer - David
Reply
42inciHakan
2 years ago
HOW MANY GOALS XAUUSD you?
+1 Reply
4xForecaster PRO 42inciHakan
2 years ago
@42inciHakan - Please, define goal.

David
Reply
mkdeep04 4xForecaster
2 years ago
http://prntscr.com/546yxx possible reswing area.. weekly candle bullish pin. same pullback to upper wedge line 18.4/18.9 resist area if hold then one leg down 13.87-11.28 area
+1 Reply
mkdeep04 mkdeep04
2 years ago
in comingweek i will watching 16.14-16.39 area for price action if holds for 2days then 14.67 tgt ... 3 candle in daily reversal interesting setup
Reply
4xForecaster PRO mkdeep04
2 years ago
@mkdeep04 - Very nice use of the 1.618 extension - David
Reply
Sokun 4xForecaster
2 years ago
Can you please explain David? Gassho
+1 Reply
Sokun 4xForecaster
2 years ago
Is it possible to update your finer time frame please David. Sincerely Gassho
+1 Reply
DanV MOD
2 years ago
Hi, whilst I agree with your overall view on Silver and Gold for that matter is similar, not sure of you could have 5-3-5-3-5-3 in leading diagonal. It is more common for that configuration to be found in ending diagonal. I think many have struggled to label both the Silver and Gold have topped. I feel that it is a wxy X wxy ir double zigzag correction.
+1 Reply
4xForecaster PRO DanV
2 years ago
Hi, @DanV - Yes, I understand that this leading diagonal is a rarer phenomenon compared to the Leading Diagonal. In addition, while its most common internal anatomy consists of a 3-3-3-3-3 composition, it also comes in a rarer 5-3-5-3-5 state as well.

I am not certain that $XAU and $XAG walk in lockstep, though, or that they are of similar matter in terms of their respective price action. For instance, I was informed by a metals broker that the all-time historical relationship of the two metal has been at 18:1, and that in its modern times, that relationship has settled at about 36:1 since 1971 (NAbandonment of the Bretton-Wood System).

Two appreciate this relative strength relationship, a few months back, I build a $XAUSUSD / $XAGUSD chart to express that relationship, and perhaps draw a predcitive/forecasting model outlook on this comparative charting - So far, the forecasts has held quite well (See:
Update: $XAU vs $XAG Keeps Rising | $GLD $SLV $Gold #Silver $USD
and
$XAU vs $XAG Remains Bullish | #Gold #Silver $GLD #SILV
), wherein the targets at or above $77.00 (in relative strength) implies a significant strengthening of Gold against the white metal.

OVERALL:
1 - Elliott Wave Principles support the concept of a Leading Diagonal whose internal structure can either be 3-3-3-3-3 or 5-3-5-3-5
and
2 - Analysis of Gold has not followed that of silver, and the predictive/forecasting model suggests that this disparity is bound to continue shortly, until a target is reached.

If and once this target is reached, Gold can still remain bullish in its own right, but silver will likely catch up by deceleration their relative price differential, thus expressing a correction that should move in the (modern) historical level of 36-to-1.

Although my precious metal broker friend has preferred to remain in the anonymity on this site, HE is welcome to chime in, here on in private, if I needed any correction in the historical ratios.

DanV, thank you very much for your input in here. And Gold broker friend: You know who you are, so feel free to mention anything elucidating here.

Cheers,

David
Reply
4xForecaster PRO 4xForecaster
2 years ago
Re: Elliott Wave Leading Diagonal

Quotes from Elliott Wave International on Leading Diagonal:

" ... the subdivisions appear to be the same: 3-3-3-3-3, although in two cases, they can be labeled 5-3-5-3-5 ... "

"These patterns were not originally discovered by R.N. Elliott but have appeared enough times and over a long enough period that the authors are convinced of their validity."

Reference: http://www.elliottwave.com/tutorial/lesson3/3-3.htm

David
+1 Reply
DanV MOD 4xForecaster
2 years ago
David, thanks for the detailed reply. However, I think there is a difference in leading and ending diagonals. Leading and ending diagonals can be 5-3-5-3-5 structure, the 3-3-3-3-3 structure is never in leading diagonal. As is this case you have noted that in this instance it is 3-3-5-3-5, hence I suspect it does not qualifies as leading diagonal. The other point is in both leading and ending diagonals wave 4 has to overlap wave 1. That is a requirement for both leading and ending diagonals. So I am wondering if this is something else but diagonals, possible double zigzag as I have mentions
GOLD Is Unloved - Could this lead to a capitulation?
+1 Reply
DanV MOD DanV
2 years ago
Silver has similar abc, x, abc zigzag count.
Reply
DanV MOD DanV
2 years ago
Yyou will note that your wave 4 does not overlap wave 1. Here is my chart suggesting double zigzag mentioned earlier.
snapshot
+1 Reply
4xForecaster PRO DanV
2 years ago
@DanV - The rules on diagonal stipulates that "Wave-4 ALMOST always moves within the territory of Wave1" (Source: EWI, Robert Prechter).

I won't contest the validity of your chart here, because I trust that you know your pattern recognition. I am only disputing the rules here, which defined LD as 33333 or 53535 internals, and that diagonal have no absolute requirements in terms of Wave-4 transgression into Wave-1 territory.

Still, I appreciate your correcting me here, as I'd rather be enhancing my EW learning any day. However, I do not see your rule reflected in the EWP. Again, not my rule. I am simply quoting right off of the book.

David
Reply
4xForecaster PRO DanV
2 years ago
Hi, @DanV. You mentioned that "the 3-3-3-3-3 structure is never in leading diagonal". You are the Elliottician in my opinion here. However, the Elliott Wave Principle defines the Leadin