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It appears gold is in the 5th wave of a rally that began February 28. We are estimating this wave ‘v’ could travel to near $3,100. If this occurs, check out the RSI values and see if it is diverging from the RSI high of 85.
RSI divergence where the wave ‘v’ RSI value is lower than the wave ‘iii’ RSI value. This is a common characteristic, especially if the fifth wave price is higher than the third wave price extreme.
If so, this divergence appears as gold nears $3,100, then it could signal a fifth wave.
Wave ‘v’ does not have to stop at $3,100. Gold could continue higher. However, the symptoms would appear that a temporary setback may need to relieve the overbought conditions.
Once the final print of wave ‘v’ is in place, then gold may decline back to $2,900 – $3,000.
There is an alternate wave count we are considering.
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