JAN 19 MORNING UPDATE

Gold:

Over the weekend we updated our current gold Ewave Analysis slightly and provided that information in a special weekend posting. Nothing has changed in the overnight trading session to alter our views on this phenomenal market.

It appears that during the overnight session gold traded sideways, and we expect this market to move higher, once this consolidation ends. In the short term our next target for the end of wave ^iii^ is 1301.80, but would not rule out a run to 1349.80, as the updated daily gold charts shows. The overnight consolidation looks like a triangle, so expect a thrust higher again, once this triangle ends.

No change to current 7 long spec positions, risking to 1204.00

Crude:

 

Over the weekend we updated the long term and short term crude charts and provided that information in a rare weekend post. As the weekend post indicates, we believe that wave iii ended at 44.20 and we are now rallying in a corrective wave iv.  Our current thinking is that wave (a) of iv ended at 51.20, and we are working through a wave (b) triangle. Within the wave (b) triangle, wave -a- ended at 45.95 and we are now rallying in wave -b-. It could be possible that wave -b- ended at the overnight session high of 49.18. The weekend post detailed our trading strategy for this market, which also remains unchanged from those comments.

 

We are long 4 positions, risking to 44.20.

 

S&P:

 

Over the weekend we updated our 10 min chart of the S&P, and provided that information in a special weekend post. There is really nothing different in that weekend updated, except we provided some discussion around the time it should take for wave -ii- of (iii) to unfold. We also talked about our trading strategy for this market. The updated 10 chart that we attached in our weekend post provides targets for where we think wave –ii- will end.

In the overnight session the S&P was down a little, and that changes nothing for us.

Recommendation: Short 2 S&P futures at 2031.00, risking to 2057.

USDX:

 

The USDX was weaker in the overnight session. We still need to do some more work on this market in the days ahead, although our overall view is that this rally is still part of wave ii of C.

 

NG:

 

We are working on the idea that wave iii ended at 2.78 and that wave -i- of iii ended at 3.35. The current setback is wave -ii-.

In the overnight session NG was weaker hitting a low of 2.98. We note that our retracement zone for wave –ii- is:

50{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} = 3.07;

61.8{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} = 3.00, so we are sitting on the 61.8{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} retracement level.

We expect wave –ii- to end soon. Watch for an intraday post on this market, as we plan to add to our long positons if our current EWave Analysis proves to be correct.

We are long 3 NG positions at 3.03, risking to 2.77.

HUI/GDX:

 

The HUI broke a major down trend line and after a little bit of testing, early this week, we expect this market to moving sharply higher, with gold. Our next short term target is 23.35, which should mark the end of wave -iii- on the GDX. Note that we have higher targets for the end of wave -iii- also.

We remain long all GDX positions, with stops at 18.80.