jan 22 morning post!

CAPTAIN EWAVE MORNING POST!

 

Gold:

 

Short Term Update:

 

Gold was quiet in the overnight session, and we remained above the current wave ^e^ low of 1092.60.

 

Our current wave *b* triangle formation remains intact, and all that we are now waiting for is confirmation that all of wave ^e^ is complete at the current low of 1092.60.

 

If it is then we should expect a sharp thrust higher in wave *c* to complete all of wave .b.. For our current triangle formation remain valid we cannot, NOW drop below the wave ^c^ low of 1071.10. Our minimum target for wave *c* is 1113.10, but we have higher projections below.

 

Our current wave *b* triangle formation looks like:

 

^a^ = 1046.80;

^b^ = 1113.10;

^c^ = 1071.10;

^d^ = 1109.90, if complete

^e^ = 1092.60, if complete to complete all of our wave *b* triangle.

 

Retracements for the end of wave .b. are:

 

50{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} = 1118.60;

61.8{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} = 1135.80.

 

Once we are sure wave *b* is complete we can also provide projections for the end of wave *c*.

 

Our current count for wave .b. is:

 

*a* = 1088.30;

*b* triangle (details above) = 1092.60, if complete;

*c* thrust higher is next with projections shown above, for end of all of wave .b.

 

Longer Term Update:

 

Wave .b. has now become more complex and we expecting further gains to complete all of wave .b. Upon completion of wave .b., we expect a drop back to the 1045.40 low, in wave .c., to complete a major low in gold in either wave 4 or wave ii of 3.

 

Active Trading Positions: Long 20 positions, with puts at 1085.00!

 

Crude:

 

Short Term Update:

 

Crude continued to rally in the overnight session reaching a high of 31.32, at the time that this Post was being written.

 

On the Intraday Chart we can now see a developing impulsive wave structure, which is the first sign that we need that a possible major bottom is now in place for this market.

 

We will need to give this market a couple more days to see if this impulsive structure continues or whether it will turns into just another rally in a continuing bear market trend lower. Like gold, the GDX and related gold stocks, except for CRJ are NOT displaying a bullish upside, and this what the Suncor Stock price is telling us.

 

Crude may rally in the short term, but our Ewave analysis on the Suncor Stock Chart indicates one more leg lower for crude. Of course our analysis for Suncor could be wrong also.

 

Long Term Update:

 

If our current analysis is correct a major low in wave b of B is at hand and crude is starting a new run back to the $150 area.

 

Active Trading Positions: Long 15 positions, with 42.00 puts, as stops, plus long 5 positions with 37.00 puts, as stops. Going to long Suncor at 13.05!

 

S&P: 

 

Short Term Update:

 

The S&P Futures sharply higher in the overnight session being up about 30 points, at the time that this Post was being written. The rally is no surprise as crude is higher and the S&P was due for at least a relief rally after the huge selling that we have seen in 2016. We will take a closer look at this market and provide an update in our End of Week Post.

 

Long Term Update:

 

Unknown at the moment.

 

Active Trading Positions: Flat!

 

USDX:

 

Short Term Update:

 

In yesterday’s End of Day Post we talked about our concern that our thrust to 99.89 failed to hold and that this market moved lower and back into the zone of our wave .iv. triangle formation.

 

This type of movement likely confirms that we were NOT working on a triangle formation at all, but some kind of complex corrective rally from the 97.21 low. We not expect that wave .iv. is taking on a different corrective pattern, and that it will likely drop back to the 97.21 low before it ends.

 

We are now short this market and risking to 99.90!

 

Long Term Trading Update:

 

Our wave .iv. corrective appears to have become more complete, and we now believe that we are heading back to the 97.21 low at least one more time before it ends.

 

Our current count for all of wave -v- is:

 

.i. = 96.64;

.ii. = 93.83;

.iii. = 100.58;

.iv. is still underway.

.v. rally to go to at least the 100.71, wave -iii- high.

 

The other much more bearish count is shown on the attached Weekly USDX(Alternate) Chart. In this our second (a), (b), (c) pattern from the wave i low of 71.33, ended at 100.72 and we are now falling in another 3 wave pattern. Within this 3 wave pattern we are working on wave -c-, with projections of 88.35 and 80.79.

 

All of our alternate counts will become valid if we drop below the 96.64 high.

 

Active Trading Positions: We short, risking to 99.90!

 

NG:

 

Short Term Update:

 

On the Intraday Chart the rally from our assumed wave .a. low of 2.405 has an overlapping wave structure which supports our view that we are rallying in wave .b..

 

We do not believe that wave .b. is complete at the current high of 2.189. It also looks like there is a triangle formation within this corrective wave .b. rally, which could be setting up a sharp thrust higher to complete all of wave .b.

 

This sharp thrust higher could coincide with the big storm that is about to hit the US Northeast over the weekend. In any event, we are still looking for higher prices within this wave .b. rally and expect that we should reach our retracement levels as follows, before wave .b. ends:

 

50{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} = 2.271;

61.8{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} = 2.324

 

Upon completion of wave .b. we expect one more drop in wave .c. to at least the wave .a. low of 2.045 to complete all of wave -b-.

 

Retracement levels for the end of wave -b- are:

 

50{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} = 2.089;

61.8{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} = 1.993

 

We are currently long this market and will take profits at the end of wave .b. We have put in a sell stop at 2.29, and will but this market again at the end of wave .c. of -b-.

 

Long Term Trading Update:

 

Our retracement levels for all of wave (iv):

 

38.2{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} = 2.91;

50{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} = 3.29.

 

For the time being we will assume that wave (iv) is a simple -a-, -b-, -c- pattern, and within that count we have :

 

-a- = 2.494;

-b:

.a. = 2.045, if complete;

.b. rally is underway;

.c. drop to at least the wave .a. low of 2.045, to complete all of wave -b-;

-c- rally to at least the wave -a- high, but more likely to our 38.2{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1}/50{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} retracement zone shown above.

 

Active Trading Positions: Long 5 at 2.05, risking to 1.69, but will take profits at 2.29!

 

HUI/GDX and Selected Gold Stocks:

 

Short Term Update:

 

Nothing new to add here!

 

Long Term Update:

 

We have now satisfied the minimum requirements for a completed wave B and are now looking for evidence of a bottom.

 

The major breakouts in ABX and Kinross have failed which could suggest much lower prices ahead. Kinross is likely now heading to the 1.07 low and ABX back to 5.89. CRJ is likely completing wave ^iv^ and should be heading higher in wave ^v^, or wave ^iv^ could become a triangle.

 

Active Trading Positions: We are long the GDX, ABX, KGC, NEM, CRJ, and TSX:XGD with no stops!!

 

Note: The Captain will be in the USA between 01/31 and 02/04. Posting should remain unaffected.

 

Thanks.