jan 28 end of day post!





Short Term Update:


Gold reached a low today of 1111.30, in today’s day session, at the time that this Post was being written.


We CANNOT yet rule out the possibility that wave *c* and all of wave .b. are both now complete at the 1128.00 high.


We need to be guard for a drop now back to the 1045.60 eave .a. low in our expected wave .c. as being the next big event tin this market. If we drop back into the wave *b* triangle zone, then wave *c*and all of wave .b. ended at 1128.00.


Our current projections and retracements are repeated below:


“With wave *b* being complete at the 1092.60 low, we can provide projections for the end of wave *c*, as follows:


*c* = *a* = 1135.40;

*c* = 1.618*a* = 1061.90. We doubt this will happen as this type of rally would break the upper red trend line on the attached Daily Gold Chart, which would eliminate the current diagonal triangle formation.


Retracements for the end of wave .b. are:


50{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} = 1118.60;

61.8{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} = 1135.80.


Our current count for wave .b. is:


*a* = 1088.30;

*b* triangle = 1092.60;

*c* = 1128.00, if complete, although we have higher projections shown above, for end of all of wave .b.


Longer Term Update:


Watch for the completion of wave .b. and the start of wave .c. lower, which has minimum target of the wave .a. low which is 1045.60.


Only a clean break of the down trend line connecting 1307.80 and 1191.70, would suggest that much more bullish things are happening in this market.


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




Short Term Update:


As we indicated in today’s Morning Post, the patterns on the Intraday Chart indicated that we believed that crude was going to continue to move higher. In today’s day session we did move higher, and reached 34.81.


We think that further gains should be expected, but in the longer term a drop back to new lows cannot be ruled out. We still have issues with proclaiming a major bottom in crude based on what we see on the Weekly Suncor Chart.


If one of our Charts is wrong, we unfortunately do not know which one is at the moment, so we will confine our current comments to short term.


Long Term Update:


We now think that crude is still going lower, before wave b of B, ends with a below $20 as being likely.


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




See the attached Daily S&P Chart.






Short Term Update:


The S&P was lower to start today’s session, but we did NOT make a new low below 1872.70. We have since turned up. So either all of wave .ii. is now complete at the 1872.70 low and wave .iii. higher has begun, or wave .ii. is becoming more complex then just a simple *a*, *b*, *c* pattern as we show below, and wave .ii. will then make a new low below the current 1872.70 low, to then complete all of wave .ii. If wave .ii. is not complete at the 1872.70 low, then the current rally is a wave *x*..


Our assumed  wave .ii. correction looks like:


*a* = 1875.97;

*b* = 1916.99;

*c* = 1872.70, if complete, but more likely to our 50{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} retracement level of 1860.57, before wave .ii. ends.


Our retracement levels for wave .ii. are:


50{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} = 1860.57;

61.8{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} = 1849.18.


A significant rally above the wave .i. high of 1908.85 would suggest that all of wave .ii. ended at 1872.70, and that we have started wave .iii. higher. Likewise a break below 1812.29, would eliminate our wave (iv) pattern and suggest that the S&P has topped out and is heading substantially lower.


Long Term Update:


Wave (iv) took a different path then our triangle option, and it now looks like we are heading sharply higher in wave (v), to at least the all time high of 2134.72. 


Active Trading Positions: Going long at 1850.00, risking to 1812.00”




Short Term Update:


The USDX was lower today in what looks like an extending of wave *c*, within our wave .iv. triangle. Today’s low was 98.45, at the time that this Post was being written. Wave *c* can continue to fall all the way to 97.21, without affecting our current triangle formation.


We think that wave *c* could still have further downside in the next 24 hours. Once wave *c* ends we expect a wave *d* rally, that cannot trade above the wave *b* high of 99.89, for this triangle formation to remain valid.  


If our wave .iv. triangle is now extending then our current count is:


*a* = 97.21;

*b* = 99.89, if complete;

*c* = 98.75, if complete;

*d* rally is now

*e* drop to complete all of the wave .iv, triangle.


The other option for wave .iv. is:


*a* = 97.21;

*b* = 99.89;

*c* drop now to at least the 97.21 low to complete all of wave .iv.


We have lowered our stops to 99.90.


Long Term Trading Update:


It now looks like our wave .iv. triangle is extending and will likely churn for another couple of weeks.


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


.i. = 96.64;

.ii. = 93.83;

.iii. = 100.58;

.iv. triangle 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 are short, risking to 99.90!




Short Term Update:


NG had a big swing day today, as it looks like wave *x* ended at 2.099, after which we moved sharply higher, reaching 2.221, at the time that this Post was being written.


This rally from our wave *x* low of 2.099 to the current high of 2.221, could be all of our second wave *a*. If that observation is correct, we should see a  drop in our second wave *b* as the next big event.


We have raised our stop to the bottom of wave *x*.


Our updated current count for all of wave .b. is:


*a* = 2.170;

*b* triangle:

^a^ = 2.069;

^b^ = 2.189;

^c^ = 2.082;

^d^ = 2.171;

^e^ = 2.129;

*c* = 2.214;


^a^ = 2.115;

^b^ = 2.211;

^c^ = 2.099, to complete all of wave *x*

*a* = 2.221, if complete;

*b* drop is next.


Our retracement levels for all of wave .b. remains as:


50{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} = 2.271;

61.8{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} = 2.324


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


50{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} = 2.089;

61.8{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} = 1.993


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;


.a. = 2.045, if complete;

.b. is becoming more complex with the detailed count above;

.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 2.09, but will take profits at 2.29!


HUI/GDX and Selected Gold Stocks:


See the attached Daily CRJ Chart.






Short Term Update:


The GDX and most our Selected Gold Stocks were marginally lower today. CRJ on the other hand made a new high with wave *iii*, reaching 1.04.


On the attached daily CRJ Chart we think we are getting very close to the end of wave *iii* of -v-, and are expect that a wave *iv* correction is due.  Wave *iv* is expected to retrace between 50 to 61.8{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} of the entire wave *iii* rally.


We will provide those retracement levels, when we are sure that wave *iii* is complete. This wave *iv* drop will likely coincide with our expected wave .c. drop in gold. Kinross, ABX and the GDX will likely make our expected new lows with that drop in gold.


Long Term Update:


Expect lower prices in the XAU and HUI, before wave B ends. We continue to hold all of our gold stocks and may just start to add more, as this sector is about to turn sharply higher.


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 02/03. Posting should remain unaffected, except on the morning of 02/03, where there will be NO Morning Post.