jan 31 morning post!

 

Subscriber Question: 

As a very new subscriber, I am very curious when you shorted the DOW, QQQ,& SPX/  because so far you have not covered the short and we have a very strong bounce from the lows in Nov....did you cover  some shorts near bottom, get stopped out or what?   I see some NL writers are back long saying this is start of another big leg up in this secular bull mkt. Just curious where the major short position started?

 

Editor Answer: We recommend that subs focus on the gold/silver/mining stocks market mainly, and play the stock market trade with smaller capital.  When the Captain was getting subs long in the big turn for gold in the $1100-$1050 area, we got a lot of similar questions to this one, but about gold.  In 2012, when the Captain’s wave counts turned very negative for gold, most analysts that because the market didn’t quickly fall, that the short side trade was dead.  Wrong.  All wrong.

 

The Captain’s stock market wave counts are calling the turn of a market that has been going up for a long time, and the topping process typically involves waves extending and triangles forming that drag out seemingly endlessly.

 

The put options are how we hedge that topping process and while the Captain isn’t interested in trying to jump in and out of what could be a once in a lifetime major wave down, we could provide some shorter term trades separate from the main “Mighty Wave” trade, for those who want that kind of action.  Your editor will look at applying some proprietary entry/exit strategies to play the Captain’s shorter term wave counts using the triple leveraged SP500 ETFs, and follow up with you over the weekend.

 

Thanks!

 

Now, here’s today’s update:

 

Gold: 

 

Daily Gold Chart:

https://captainewave.com/wp-content/uploads/2019/01/ewjan3119gold.png

Short Term Update:

 

Gold was once again higher in yesterday’s day session and that trend continued in the overnight session as we have reached a high of 1330.20!

 

Editor’s comments:  Wheeeeeeeeeeeeee!!!!!!!!!!!!!!!!!!

 

We still see higher prices ahead.

   

We continue to rally in wave ?v? of !iii!, as shown on our Daily Gold Chart. Wave ?v? is expected to have a 5 wave impulsive sequence of which we are still likely working on the first.

 

Our next projected target for the end of wave ?v? and !iii! is:

 

!iii! = 2.168!i! = 1358.40.

 

Longer term our first projection for the end of wave .iii. is:

 

.iii. = 1.618.i. = 1447.20.

 

We do have higher projections. Of course, wave .iii. will subdivide into a 5 wave impulsive sequence in its journey higher.

 

Trading Recommendation: Long gold. Use puts as stops.

 

Active Positions: We are long, with puts as stops!

 

Silver:

 

Daily Silver Chart:

https://captainewave.com/wp-content/uploads/2019/01/ewjan3119si.png Short Term Update:

 

Silver was higher in yesterday’s day session and that trend continued in the overnight session a we have reached a high of 16.16! 

 

We still see higher prices ahead.

 

Like gold we have adopted our very bullish count that is suggesting that wave ^iii^ of .i. is still underway. Our next projected target for its completion is :

 

^iii^ = 4.25^i^ = 16.94.

 

We are now trying to break above resistance at the 16.05/16.10 level, which we expect will be breached.

 

Trading Recommendation: Long silver. Use a put as a stop.

 

Active Positions: We are long, with puts as stops!

 

Crude Oil:

 

Daily Crude Chart:

https://captainewave.com/wp-content/uploads/2019/01/ewjan3119oil.png

Short Term Update:

 

Crude was higher in yesterday’s day session as we reached a high of 54.93. In the overnight session we moved sideways to currently be trading at the 54.36 level.

 

It looks like wave *a* of (b) had one more skip higher so we are now once again waiting for confirmation that all of wave *a* of (b) is complete current high of 54.93, and that we have started to move lower in wave *b* of (b).

 

Our expected wave (b) rally is now underway. Our retracement level for all of wave (b) is:

 

50{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} = 59.41;

61.8{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} = 63.52.

 

In the short term we have now shown a possible 3 wave pattern within wave (b), and if this pattern is what crude is doing, then all of wave *a* of (b), could now be complete at the 54.93 high.

 

Upon completion of wave *a* we expect a wave *b* setback that will then be followed by another rally in wave *c* to complete all of wave (b). We are expecting that wave *b* should retrace between 50 to 61.8{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} of the entire wave *a* rally. Of course wave (b) could become much more complex than we are currently suggesting also.

 

Since we are rallying in a wave (b), we should expect this rally to be choppy and full of an overlapping wave structure.

 

Suncor: We continue to rally in wave (ii). As a minimum the wave (ii) rally will have at least one 3 wave pattern, as shown on the Weekly Suncor Chart. If crude has now completed wave *a* of (b), then we should except that Suncor has completed its first leg higher within wave (ii), at the 32.51 high. We should expect that the wave (ii) rally retraces between 50 to 61.8{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} of the entire wave (i) drop. Those retracement levels are:

 

50{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} = 34.04;

61.8{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} = 35.98.

 

Trading Recommendation: Long with put at 57.00 as a stop.

 

Active Positions: Long with put at 57.00 as a stop.                                    

 

US 10 Year Bond Yield:

 

Daily US 10 Year Bond Yield Chart:

https://captainewave.com/wp-content/uploads/2019/01/ewjan3119bond.png

Short Term Update:

 

The US 10 Year Bond Yield was lower in yesterday’s day session, and that trend continued in the overnight session as we are have reached a low of 2.668{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1}.

 

We are now waiting for confirmation that all of wave $iv$ is complete at the 2.799{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} high, and that our wave $v$ drop is underway, as it could become complex like a bearish triangle.

 

We continue fall in wave (ii). We expect wave (ii) to retrace between 50 to 61.8{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} of the entire wave (i) rally. Those retracement levels are:

 

50{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} = 2.641{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1}

61.8{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} = 2.498{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1}

 

We should now be rallying in a small wave $iv$ corrective rally, which could be complete at the 2.799{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} level. Our retracement levels for all of wave $iv$ are:

 

23.6{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} = 2.710;

38.2{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} = 2.807.

 

We have now reached our 38.2{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} retracement level, so we really need to be guard for the completion of wave $iv$ and the start of another drop with wave $v$ of *a*, that will complete all of wave *a*, as shown on the Daily US 10 Year Bond Yield Chart.

 

Trading Recommendation: Flat now.

 

Active Positions: Flat!

 

S&P500: 

 

Daily SP500 Chart:

https://captainewave.com/wp-content/uploads/2019/01/ewjan3119spd.png

120 Minute SP500 Chart:

https://captainewave.com/wp-content/uploads/2018/08/ewaug2818sp2.png

 

Short Term Update:

 

The SP500 was higher in yesterday’s trading session, reaching 2690.44. In the overnight session the SP500 Futures are almost unchanged.

 

We are continue to drop in sharply in wave (iii), which has an initial projection for its completion of

 

(iii) = 1.618(i) = 2256.01.

 

Within wave (iii), we are now subdividing with wave .i. ending at 2346.58 and we continue to move higher in an extended wave .ii. corrective rally, which should end soon. The end of wave .ii. may have occurred at our new high of 2690.44. Our 78.6{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} retracement level is:

 

78.6{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} = 2703.11.

 

We need to be guard for the completion of wave .ii. now and the start of a very sharp drop in wave .iii. of (iii). A drop now below the 2600.00 level would likely confirm that all of wave .ii. is complete at the 2690.44 high. We will provide our initial projection for the end of wave .iii., once we believe that all of wave .ii. is complete.

 

Trading Recommendation: Stay short with a call option as a stop.

 

Active Positions: Very Short with an updated call as a stop.

 

USDX:

 

Daily USDX Chart:

https://captainewave.com/wp-content/uploads/2019/01/ewjan3119usd.png

Short Term Update:

 

The USDX reached a high of 95.69 in yesterday’s day session before moving sharply lower. That trend lower continued in the overnight session as we have reached a low of 94.83.  

 

We still believe that wave (iii) lower is now underway, with our first projection for its completion being:

 

(iii) = 1.618(i) = 72.37

 

Within wave (iii), we are now working on wave ^i^ and within wave ^i^ all of wave $ii$ is now complete at the 96.37 high. We are now falling in wave $iii$, as shown on the Daily USDX Chart. Our initial projection for the completion of wave $iii$ of ^i^ is;

 

$iii$ = 1.618$i$ = 91.39.

 

We have lowered our stop to 96.40. 

                                 

Trading Recommendation: Short, risking to 96.40.

 

Active Positions: Short, risking to 96.40.

 

NatGas: 

 

Daily NG Chart:

https://captainewave.com/wp-content/uploads/2019/01/ewjan3119ng.png

Short Term Update:

 

NG traded sideways in yesterday’s day session and that trend continued in the overnight session as we are currently trading at the 2.873 level.

 

Our current count needs to be updated. More details coming.

 

We are looking at dropping NG and replacing this market with another in the next week or so.

 

Trading Recommendation: Flat.

 

Active Positions: Flat.

 

GDX & Gold Stocks:

 

GDX 60 Min Chart:

https://captainewave.com/wp-content/uploads/2019/01/ewjan3119gdx60.png

GDX Daily Chart:

https://captainewave.com/wp-content/uploads/2019/01/ewjan3119gdxd.png

Short Term Update:

 

The GDX was sharply higher in yesterday’s trading session, as we reached a high of 22.55!

 

Editor’s comments:  We think you know!

 

As you can see on the Daily GDX and 60 Min GDX we recently updated our count to a much more bullish outcome. We are still working on wave -iii-. but it is now subdividing as shown on the 60 Min GDX Chart.

 

It looks like wave *i* of -iii- ended at 21.54 and wave *ii* of -iii- at 20.22.

Our 50{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} retracement for all of wave ^ii^ was 19.90.

 

If that is the case then we should now be rallying in a powerful wave *iii* of -iii- which has an initial projection of:

 

*iii* = 1.618*i* = 25.53!

 

We suspect that wave *iii* is also going to subdivide and in that case we are still working on wave ^i^ of *iii*, which is likely close to ending. Once we ends we expect a wave ^ii^ drop that should retrace between 50 to 61.8{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} of the entire wave ^i^ rally.

 

Our updated projection for the end of wave -iii- is:

 

-iii- = 2.618-i- = 26.72.

 

Longer term our first projection for the end of wave 3 is:

 

3 = 1.618(1) = 48.95.

 

We have the following counts, for the following:

 

Kinross: Has now completed its minimum requirements for a completed wave (ii), at the 2.38 low. Wave  (iii) rally is now underway.

 

Barrick:  We have completed the minimum requirements for a completed wave (ii) at the 9.53 low. Wave (iii) rally is now underway.

 

HUI: We have completed the minimum requirements for a completed wave (ii), at the 131.12 low. Wave (iii) rally is now underway.

 

XAU: We have completed the minimum requirements for a completed wave 2 at the 60.59 low. Wave 3 rally is now underway.

 

Trading Recommendation: We continue to suggest buying all of the above gold stocks and indices, for a long term hold.

 

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