After reviewing the latest data, it looks like we might fall short of the bearish target in the previous update. However, we’re still expecting the price to reach the mid-channel point, aligning with the 0.764 retracement level, to complete Wave B at 69.449.
From there, Wave Y is estimated to finish around the 0.236 level at 83.274. Expecting one more pushdown to complete the internal Wave B.
XAG/USD Elliott Wave analysis: Anticipating a Running Flat for Wave (Y), expecting one more pushdown to complete internal Wave B at 69.449, with Wave Y estimated to reach the 0.236 level at 83.276.
Master the Most Common Corrective Pattern · Rules, Guidelines & Trading Applications
What is a Zigzag?
A zigzag is one of the most common Elliott Wave corrective patterns. It consists of three waves (A-B-C) that move sharply against the larger trend, creating a distinctive “Z” shape on the chart. Zigzags are highly directional reversals with clear structure and reliable Fibonacci targets, making them essential for traders to identify and trade.
Zigzag Structure: A-B-C Breakdown
Wave
Structure
Direction
Characteristic
Wave A
5-wave impulse (or 3-wave)
Against trend
Sharp, decisive move down (or up)
Wave B
3-wave correction (any type)
Against Wave A (bounce)
Retraces 50%–79.6% of Wave A
Wave C
5-wave impulse
Same as Wave A
Sharp move, often extends 1.236–1.618 of Wave A
Key Point: Zigzags are characterized by sharp, impulse-like moves in waves A and C, with a corrective bounce in Wave B.
Official Zigzag Rules
Rule 1: Wave A Structure
✅ Wave A MUST be a 5-wave impulse (or 3-wave in rare cases) ✅ ALWAYS moves OPPOSITE to the preceding trend ✅ Cannot overlap Wave 4 of the preceding impulse
Rule 2: Wave B Retracement
✅ MUST be a 3-wave corrective structure ✅ Retraces 50–79.6% of Wave A ❌ CANNOT retrace more than 100% of Wave A
Rule 3: Wave C Structure
✅ MUST be a 5-wave impulse ✅ Typically reaches 61.8–100% of Wave A ✅ Can extend to 123.6% or 161.8% of Wave A
Rule 4: Zigzag as a Whole
✅ 7-swing structure (5+3+5) ✅ Retraces 50–79.6% of the preceding impulse ✅ Occurs in positions 2, 4, A, or B of larger structures
Fibonacci Relationships in Zigzags
Wave B Retracement of Wave A
Fib Level
Typical Range
Frequency
Notes
50%
Shallow retrace
20%
Less common, indicates strength
61.8%
MOST COMMON
60%
Golden ratio – target this first
76.4%
Deeper retrace
15%
Still valid zigzag
79.6%
Maximum valid
5%
At limit – deeper = not a zigzag
Wave C Extent Compared to Wave A
Fib Ratio
Wave C Size
Frequency
Trading Implication
0.618 of A
Shorter C
15%
Weak zigzag – trend resuming
1.0 of A
EQUAL WAVES
50%
Most balanced – primary target
1.236 of A
Extended C
25%
Aggressive downside – deep correction
1.618 of A
Extreme C
10%
Panic selling/buying – violent moves
Types of Zigzags
1. Standard (Most Common)
Structure: A (5) → B (61.8%) → C (100% of A) Frequency: 50% Trading: Most reliable, easy to trade
2. Extended (Aggressive)
Structure: A (5) → B (shallow) → C (1.236–1.618 of A) Frequency: 25% Trading: More profit, higher risk
3. Truncated (Weak)
Structure: A (5) → B (3) → C (0.618 of A only) Frequency: 15% Trading: Weak – trend resuming quickly
4. Double/Triple (Complex)
Structure: W → X → Y [→ X → Z] Frequency: 10% Trading: Multiple entry points, takes longer
Trading Zigzag Patterns
Setup 1: Anticipate Wave C From Wave B High
After Wave B completes, set sell orders at 100% or 123.6% of Wave A extension from Wave B start.
Wave B retrace
61.8% of A
Entry
At Wave B high, anticipating C wave down
Target C
100% or 123.6% of Wave A extent
Risk
Above Wave B high (invalidation)
Setup 2: Trade the Wave C Breakout
After Wave C completes, trade the trend resumption above Wave A high.
Confirmation
Close above Wave A high = zigzag complete
Entry
BUY break above Wave A high + pullback
Target
Wave 1 of new impulse
Stop
Below Wave C low
Setup 3: Wave B Bounce Trade
Trade the bounce from Wave A low up to the 61.8% retracement.
Entry
At Wave A low (start of Wave B)
Target
61.8% of Wave A (Wave B expected high)
Stop
Below Wave A low
Duration
Quick 1–3 day trade
Zigzag Identification Checklist
Does Wave A have 5-wave subdivision?
Is Wave A moving AGAINST the larger trend?
Does Wave B retrace 50–79.6% of Wave A? (61.8% most common)
Is Wave B a 3-wave structure (ABC)?
Does Wave C have 5-wave impulse structure?
Is Wave C moving in the same direction as Wave A?
Does Wave C reach 61.8–161.8% of Wave A (typically 100%)?
Does the whole zigzag retrace 50–79.6% of the prior impulse?
After completion, does price break above Wave A high?
No overlap violations between waves
Common Zigzag Mistakes to Avoid
❌ Mistake 1: Calling a Wave B retrace >79.6% a zigzag. ✓ Fix: If B retraces >79.6%, it’s likely a flat or other corrective structure.
❌ Mistake 2: Forcing a 3-wave pattern into a zigzag. ✓ Fix: Wave A MUST have 5 waves. 3-wave A = NOT a zigzag.
❌ Mistake 3: Entering Wave C before Wave B is confirmed. ✓ Fix: Wait for Wave B to hit the Fib level before shorting.
❌ Mistake 4: Using Wave A as the only Wave C target. ✓ Fix: Wave C often extends to 1.236–1.618× Wave A.
❌ Mistake 5: Dismissing a pattern because Wave B looks “too big.” ✓ Fix: Wave B can retrace 50–79.6% – trust the math, not the eye.
Real Example: XAUUSD Zigzag
Gold completes Wave 5 of impulse at 4,800, then enters Wave 2 correction.
Wave
Structure
Price Level
Fib Notes
Wave A Down
5-wave impulse
4,800 → 4,500 (300 pips)
Sharp down
Wave B Up
3-wave bounce
4,500 → 4,685 (185 pips)
61.8% of 300p = 185p ✓
Wave C Down
5-wave impulse
4,685 → 4,415 (270 pips)
90% of Wave A ✓
Trade Plan
1. SHORT at 4,685 (Wave B high) 2. Target: 4,415 (100% of Wave A from 4,685) 3. Stop: 4,750 (above Wave B high) 4. R/R: 270 pips / 65 pips = 4:1 ✓
W-X-Y Correction Structure
Wave Component
Wave Structure
Trading Implication
Wave W
5-wave corrective pattern (down)
Initial correction – establishes support
Wave X
3-wave countertrend (up)
Connecting bounce – more correction ahead
Wave Y
5-wave or complex (down)
Final target – deeper than Wave W alone
⚠️ Why W-X-Y Matters: Traders expecting a simple A-B-C zigzag get stopped out when Wave X completes and Wave Y begins. Use 0.618–0.764 Fib extension levels to anticipate Wave Y completion.
Quick Reference: Zigzag Essentials
Structure: A (5 waves) → B (3 waves, 61.8% retrace) → C (5 waves, 100% of A)
Best Fib Levels: Wave B = 61.8% of A | Wave C = 100–123.6% of A
Master sideways Elliott Wave flat corrections with Wave A, B, C structure. Learn Fibonacci extensions (1.272–1.618), wave B retracement rules (90–110%), and three flat correction types for professional trading analysis.
? XAUUSD INTRADAY ANALYSIS
January 6, 2026 | 4H Timeframe
? Session & Context
Instrument: XAUUSD (Gold)
Timeframe: 4H
Date/Session: January 6, 2026 | Asia/London
Trend Context: Bullish (Wave C – expanding flat in larger correction)
? Current Structure
Wave Label: Wave C – Contracting Wedge Formation
Intraday Bias: SELL 80%
XAUUSD forming tightening wedge on 4H. Upper resistance sloping DOWN, lower support sloping UP.
Price at 4,460 squeezed between 4,500 and 4,280. Compression signals imminent breakout within
3–5 candles. Macro Wave C bearish structure = 80% downside probability.
✓ Momentum: RSI at 52.57 (neutral) – volume spike expected
✓ Elliott Wave: Wave C (expanding flat) final leg active
⚙️ Execution Notes
Trigger: Clear close below 4,400 on 4H candle + volume spike
Management: Scale SHORT at 4,440, add on close below 4,400. Trail stop to 4,420 after 4,380. Take profit: 50% at 4,304, 50% at 4,280.
⚠️ RISK DISCLAIMER: This analysis is educational. Trading involves substantial risk. Not financial advice. Manage risk responsibly.
On the 15‑minute chart, GOLD (XAUUSD) continues to grind higher within the current impulse, with price now working through wave (5) of this sequence. Wave (4) has reacted cleanly from support, holding above the prior wave (1) high at 4419.837, which keeps the impulsive structure in GOLD (XAUUSD) intact and validates the immediate bullish bias.
Using the length of wave (1) as a guide, the main intraday targets for wave (5) in GOLD (XAUUSD) come in at the 1.000 and 1.236 extensions, sitting roughly in the 4,497–4,515 zone, while an extended move could stretch toward the 1.618 level near 4,539. As long as price stays above the wave (4) low and the rising trendline on GOLD (XAUUSD), dips on lower time frames are treated as opportunities to join wave (5), with caution warranted as those Fibonacci objectives are approached where profit‑taking and a larger corrective pullback are likely.
This GOLD (XAUUSD) analysis – Elliott Wave update looks at the developing corrective structure in wave b within the broader market context, using the 4‑hour chart to map the triangle and key support zones.
Current intraday structure
On the 4‑hour chart, GOLD (XAUUSD) shows wave ((C)) of b potentially taking the form of an expanding triangle in the orange degree, with price stretching slightly beyond prior swing extremes while still respecting the overall converging channel and Fibonacci projections. Within this Elliott Wave interpretation, wave ((C)) looks close to completion, with the latest push higher likely finishing the final sub‑wave of the pattern.
As an alternate GOLD (XAUUSD) analysis – Elliott Wave view, wave b can be counted as a W–X–Y double three in red, with the latest upswing forming the terminal leg of wave Y. This alternate remains valid while price holds below the upper resistance band and the internal subdivisions retain a corrective character rather than a clean 5‑wave impulse.
Key levels and next area of interest
Under the preferred triangle scenario for GOLD (XAUUSD), the next downside objective is the 0.382–0.764 retracement zone of wave ((C)), highlighted as the potential wave ((D)) demand area on the chart. This box aligns with prior structure support and the lower boundary of the developing sliding correction, making it the primary “buy‑the‑dip” region if price can correct into it in a controlled three‑wave decline.
Invalidation for this GOLD (XAUUSD) analysis – Elliott Wave roadmap sits beneath the lower edge of the wave ((D)) zone; a decisive break there would suggest wave b has already topped in a more complex fashion, shifting focus back to deeper corrective possibilities before the higher‑degree advance resumes.
Wave iv flat correction above support
GBPUSD Elliott Wave analysis currently shows price consolidating in a wave iv flat correction within a broader bullish structure on the 4H chart. The pair is holding above the 0.382 Fib support at 1.32855, which aligns with the base channel support and keeps the medium‑term uptrend intact. As long as this zone continues to hold, the working assumption is that wave iv is still unfolding rather than a full trend reversal
GBPUSD Elliott Wave Analysis – Wave iv Flat on 4H
Intraday structure and bullish trigger
Intraday, the bias is neutral‑to‑bullish while wave iv completes, with attention on the internal structure of wave (c) of ((b)). The plan is to wait for internal wave (4) of ((c)) to form(around1.33430) and then look for a break back above that high as the trigger for renewed upside momentum. If that confirmation arrives, the next objective is a wave v advance targeting the 0.618–0.764 Fib zone between 1.35418 and 1.36354, where prior resistance and Fibonacci confluence may cap the move.
When the Elliott Wave count fails
If price were to lose the 1.32855 support and break cleanly below the base channel, it would warn that wave iv is evolving into a deeper correction or that the larger bullish count needs to be reassessed. Until then, GBPUSD Elliott Wave analysis continues to favour buying dips into support rather than chasing extended strength at the top of the range.
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This DXY Elliott Wave analysis examines a 4H wave (2) zigzag correction within a larger bullish wave (1) impulse, highlighting the support cluster around prior wave‑1 lows and the 0.618 retracement.
Wave structure and context
On the 4H chart, this DXY Elliott Wave analysis labels the advance into the recent high as wave (1) and the current decline as wave (2) in a zigzag within a well‑defined corrective channel.
Higher timeframe count labels the advance into the recent high as wave (1) impulse, with the current decline mapped as wave (2) correction unfolding as a clear A‑B‑C zigzag within a well‑defined red corrective channel.
Wave C is probing into the green support box between the 0.618 retrace near 97.918 and prior wave‑1 support around 97.808, aligning price, structure and fib symmetry for a potential completion of wave (2).
Key levels and trade plan
Support is anchored at 97.808 (wave‑1 low), with resistance at 98.764 (wave A) and upside fib targets projected toward the 0.5–0.618 extension window at 122.102–132.161 for the prospective wave (3) advance.
The trading plan favours a long bias from 98.415, with protective risk just below 97.698 under wave‑1 support and an initial take‑profit focus at 121.258, assuming the corrective channel eventually breaks to the upside.
Confluence and validation
Confluence comes from the 0.618 fib tap at 97.918, price still respecting the corrective channel boundaries, and 4H RSI divergence, all consistent with a maturing corrective low rather than fresh impulsive selling.
This DXY Elliott Wave analysis roadmap ties in with your broader cross‑market view in the existing DXY, gold and GBPJPY analysis, with the invalidation zone below 97.698 acting as the line in the sand that would negate the immediate long scenario and force a reassessment of the wave count.
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Gold Elliott Wave Analysis on the 15-minute chart shows wave 4 consolidation completing. Expecting pullback to key Fibonacci levels before continuation of the bearish move.
This EURUSD Elliott Wave analysis shows wave (D) of the correction is complete. We’re now expecting wave (E) to develop as the final leg of this corrective structure.
Key Level: A break below 1.17205 will confirm the EURUSD Elliott Wave analysis and signal wave (E) is underway.
Watching for completion of wave (E) before looking for long entries. ?
Gold is completing an ending diagonal within a rising wedge the classic exhaustion pattern that precedes Wave 3 of C decline. This Elliott Wave DXY Gold GBPJPY analysis examines Gold’s bearish setup that aligns perfectly with the bullish DXY thesis from our three-market study. study.
Elliott Wave Gold is set for a significant Wave 3 decline once the ending diagonal exhausts at 4,294–4,296. Watch for spike-and-rejection confirmation, then trade the 5-wave rollover toward 3,600–3,200.
Key Takeaway
Elliott Wave DXY Gold GBPJPY correlation is confirmed Elliott Wave Gold is set for a significant Wave 3 decline once the ending diagonal exhausts at 4,294 – 4,296. This Elliott Wave analysis of Gold supports the broader USD strength thesis. Watch for the spike-and-rejection confirmation, then trade the 5-wave rollover through support toward 3,600–3,280.
Part of Our 3-Market Elliott Wave Analysis
This Elliott Wave Gold analysis is Part 2 of our comprehensive three-market study. Read the complete breakdown:
Part 1: Elliott Wave DXY bullish Wave 5 setup Part 2: Elliott Wave Gold ending diagonal (you are here) Part 3: Elliott Wave GBPJPY triangle breakdown
Subscribe for real-time Elliott Wave Gold updates as price action unfolds.
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