Jan 14 Captain Ewave Morning Update


In the overnight session gold made a new low for this correction at 1225.40. As we mentioned in yesterday's End of Day Post, the wave structure in the intraday chart from the 1244.30 high to the current low is full of overlapping waves , which is corrective. Once this correction ends, gold should be going much higher.

No change to current long positions or stop locations.



If you combine yesterday's day and the overnight session, on the intraday chart you can see a very nice 5 wave impulsive move from 44.21 to 46.76. After the 46.38 we appear to have corrected to 45.02, and then rallied again. In yesterday's End of Day Post we had thought that the impulsive wave had ended at 46.17, which generated the following retracement levels:

50{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} = 45.19;

61.8{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} = 44.95.

Since the impulsive wave actually ended at 46.76, the revised retracement levels would be:

50{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} = 45.49;

61.8{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} = 45.18

As mentioned the current overnight low is 45.02, which by chance was our recommended buy price for 2 long positions that we were filled on. Sometimes even the Captain does get lucky!!! At this point it is not clear to us that all the corrective wave that started at 46.76 is complete at 45.02.

In the longer term we are working on the assumption that all of wave iii has now ended and that we are now rallying in a multi-month wave iv of C. Since wave iv is a corrective wave it could take many forms(single (a),(b),(c), triangle, multiple (a),(b)(c) patterns... up to 3), and it is a bit too early to say what that form will be. So for the time being we will label the wave iv as follows(from the 44.21 low):


.i.= 46.76;

.ii.=45.02, if complete;

.iii. is now.

We will buy 2 more positons at 46.80. Current risk is to 44.20.


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The S&P went kind of sideways in the overnight session.

On the attached updated 10 Min S&P chart we are working on the assumption that we are in wave *iii* of .iii. of  -i- of (iii). In EWave Analysis it is at this point that the market moves are the most extreme. So if the analysis that is shown on the attached chart is correct we should expect the S&P to plunge, probably for the rest of this week. We are not sure that all of wave *ii* at 2028.93, but if it  did not the plunge is still going happen, but only take a little bit longer. Note that the *iii*=1.618*i* target is around the 1950 level. We did include the comments below in yesterday's End of Day Post, which remains unchanged, except our preferred end of wave .iii. has changed to the 1946.37 level:

*i* = 2008.25;

*ii* = 2028.93, if complete?

*iii* will likely start tomorrow.

Since wave .i. ended at 2038.33 and wave .ii at today's high of 2056.93, we can project the end of wave .iii. as follows;

.iii. = 2.618.i. = 1988.60;

.iii. = 4.236.i. = 1946.37. This is our preferred target at the moment

We remain short 4 positions with our stops at 2057.00

 St comments: And party time continues!



The USDX did nothing in the overnight session, so we repeated yesterday's End of Day Post:

"We can see a possible impulsive wave structure down from 92.50 to 91.72, followed by at corrective abc rally to the current highs, on the intraday charts. We will be watching this market closely today. Look for a possible intraday posting.

We are short (just filled) two positions at 91.70, and will be risking to 92.55"




In the last 24 hours, NG has been up sharply, and in the overnight session we have broken out above the down trend line connecting 4.51 and 3.93, current hitting a high of 3.08. This is our signal that all of wave ii of C probably ended at the 2.78 low. If this is the beginning of a multi-year wave iii rally, we will have time to enter this market form the low in on the next pullback. We will update our long term and daily NG charts this weekend and provide the next trading opportunity. Looks like we miscalculated the last drop to 2.78.

We suspect that crude and NG will rally together.


No change to our current thinking in this market. As mentioned in our last End of Day Post, we are working on the assumption that wave .iv. ended at 20.31, but are a bit concerned that all of wave .iv. took a day to unfold, although if the gold correction is over this market is heading higher.


No changes to the current 60 min GDX chart:

(i) = 18.91;

(ii) = 17.16;


-i- = 18.48;

-ii- = 18.76


.i. = 18.71;


*a* = 18.05:

*b* = 18.60;

*c* = 17.95, to complete all of wave *ii*:


*i* = 18.80;

*ii* = 18.40. Note that 50{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} retracement is 18.38:


^i^ = 19.26;

^ii^ = 18.76;

^iii^ = 20.69:

^iv^ = 19.82:

^v^ = 20.67, to complete all of wave *iii*;


^a^ = 19.82;

^b^ = 20.52;

^c^ =  19.61, to complete all of wave *iv*.

*v* = 21.89, to complete all of wave .iii.;

.iv. = 20.31?, if complete.

.v. is set to begin.


We remain long all GDX positions.