DEC 29 EOD

not sure I sent this last night. here it is.
Excellent work by the Captain, particularly on GDX.
-thanks, st

DEC 29 CAPTAIN EWAVE EOD & SPEC TRADES

Gold:

The gold sell-off was a bit of a surprise, with we indicated a few days ago that we needed to rally above the down trend line connecting 1238.90 and 1223.80 and now the recent high of 1199.10 to remove all doubt that wave .ii. of -iii- ended at 1170.80. Like the HUI/GDX, wave .ii. of -iii- in gold is likely also subdividing, which in the longer term is very bullish. We need to break the down trend line! A run back to the 1170.80 could be possible now.

Crude: Looks like wave -iv- of iii was a pure triangle, as we suspected. It ended at 55.63 as a triangle itself in wave *e*. Crude also has thrust lower in wave -v- of iii and has satisfied the minimum requirements for a completed wave -v-, as we have traded below the wave -iii- low of 53.95. At the time of this post today's low in crude is 52.94. We see no indication of a bottom in this market, although we are deeply oversold and believe the next big event in this market is a large wave iv rally. Wave iv should retrace between 23.6 to 38.6{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} of the wave iii fall. When we know that wave iii has bottomed we will provide more definitive projections for the end of wave iv. Expect a turn at any time in this market now.

A close above 53.95, would be a positive indication that wave iii is likely over, before the market closes today. Speculators could go long on that event and risk to 52.93.

S&P:

We remain short this market by the thickness of a hair on our head! Like the USDX our longer term comments on this market remain unchanged.

HUI/GDX:

Trading the HUI/GDX and the gold market can certainly turn one into an alcoholic. The HUI/GDX as down today as it looks like this market is subdividing further as the attached GDX chart indicates. The important thing is that rallies are impulsive looking and setbacks are corrective looking. Until that changes we have to stay bullish.

USDX:

We were stopped out of our short position as the USDX hit a high of 90.27. Our longer term comments remain unchanged.

NG: NG is rallying as we indicated in our Morning Post today. We are rallying in wave .iv. of -v- of (c) of ii. The rally from our wave .iii. low of 2.97 to today's high of 3.21 is clearly impulsive looking. Wave .iv. should consist of at least one *a, *b*, *c* pattern, and we are likely finished most of wave *a* at today's high.

There is an outside chance that all of wave ii has now ended at the 2.97 low, although this is not our preferred analysis of this market. Should this rally continue higher and break above the down trend line connecting waves -ii-(4.53) and wave -iv-(3.94), then we would likely concede that wave ii has ended at Friday's low of 2.97.

Thanks