JAN 6 WEEKLY CHARTS POST!

 

CAPTAIN EWAVE LONG TERM CHARTS UPDATE

 

Gold: 

 

Note: Next Regular Morning Post will be January 10th, although the Captain will be monitoring the markets from Minneapolis and your Editor will be sending you some key long term gold stock charts and updates from the Captain in the interim!

 

Weekly Gold Chart: https://captainewave.com/wp-content/uploads/2019/01/ewjan619gold.png

 

Longer Term Update:

 

Gold was higher again past week as we challenged the 1300.00 level and reached a high of 1300.40, which is pretty much exactly our extended $1300.30 target price!  

 

As projected, we then closed the week lower, ending at 1285.80.

 

We continue to rally in a subdividing wave $iii$, where we continued to rally in a subdividing wave !iii!. We did reach our first projected target of 1296.40, with the rally to 1300.40. If wave !iii! is now complete the we should now be correcting in wave !iv! as shown on the Daily Gold Chart.

 

Wave !iv! should retrace between 23.6 and 38,2{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} of the entire wave !iii! rally, with those levels being identified in our last Friday’s Morning Post. The low on Friday was 1278.10, which is within our 23.6 to 38.2{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} retracement level for all of wave !iv!, so it could be possible that it is complete at the 1278.10 low.

 

If that is the case we should now start to rally again in wave !v! of $iii$, which has projected target of 1324.60.

 

The other possibility is that only wave ?iii? of !iii! ended at the 1300.40 high and that the current correction is wave ?iv?. We did describe this option in last Friday Morning Post. In either case gold is correcting, but we are not sure whether the correction is already complete at the 1278.10 low and that gold is going to move higher now, or whether we need another day or so for one of these corrective patterns to complete before we move higher again.

 

We still expect the that USDX to accelerate lower very soon, which will result in gold accelerating higher.

 

Our first projection for the end of wave .iii. is:

 

.iii. = 1.618.i. = 1447.20, but we have higher projections also.

 

Longer term, our first and second projections for the end of wave -iii-, as shown on the Weekly Gold Chart, are:

 

-iii-=1.618-i-=1661.80;

-iii-=2.618-i-=1993.70.

 

Active Positions: Long with puts as stops!

 

Silver:

 

Weekly Silver Chart: https://captainewave.com/wp-content/uploads/2019/01/ewjan619si.png

 

Longer Term Update:

 

Silver was higher this past week as we reached a high of 15.96, although we closed a little lower at the 15.79 level.

    

This week on the Daily Silver Chart we provided our initial count for the internal wave structure of wave .i.. It looks like all of wave ^iii^ of .i. could be complete at the 15.96 high and that we are now correcting in wave ^iv^. This is shown on our Daily Silver Chart. If we are now correcting in wave ^iv^ then we should except to retrace between 23.6 to 38.2 {6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} of the entire wave ^iii^ rally.

 

Those retracement levels are shown in our Friday Moring Post. Unlike gold the low on Friday is silver did not reach our 23.6{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} retracement level which is suggesting that wave ^iv^ in silver is still.

 

The other option is that wave ^iii^ is still underway and heading to our next projected target of 16.94, after which wave ^iv^ will begin. We did provide details of this option in our Friday Morning Post.

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

 

iii = 1.618i = 26.09.

 

In the very long term we completed all of wave III at 49.00 in 1980 and all of wave IV at 3.55 in 1993. We are now working on wave V and within wave V we have the following count;

 

1 = 49.82;

2 = 13.67. Note that wave 2 retraced 78.6{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} of the entire wave 1 rally.

3 rally has now begun.

 

Active Positions: Long with puts as stops!

 

US 10 Year Bond Yield:

 

Longer Term Update:

 

The 10 Year US Bond Yield was sharply lower this past week, (WITH US SHORT!) as we reached a low of 2.554{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1}, although on Friday we did rally to recover some of those losses to close at 2.659{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1}.

 

All of wave (i) is complete at the 3.248{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} high and that we continue to fall in a multi-month wave (ii) correction. Our current internal wave structure wave (ii) is suggesting that we are falling in a 3 wave pattern of which we are now falling in an incomplete wave $iii$ of *a*, which finally likely ended at the 2.554{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} level this week. If that is the case then are rallying in wave $iv$, that should retrace between 23.6 to 38.2{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} of the entire wave $iii$ drop.

 

Our retracement levels for all of wave (ii) are:

 

50{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} = 2.641{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1}

61.8{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} = 2.489{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1}.

 

In the lower term we are working on a larger wave iii rally that has an initial projection of 4.11{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1}, although it should take many months to get there.

 

The 10 Year Bond Yield reached a historic low of 1.336{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} on July 06, 2017, and we have now started to rally higher. We expect over the next number of years, that US 10 Year Bond Yields will rally back to at least the 15.84{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} level that was reached in September of 1981.

 

We took profits on our short positions this week.

 

Active Positions: Took profits, now flat!!!

 

Crude:

 

Longer Term Update:

 

Weekly Crude Chart: https://captainewave.com/wp-content/uploads/2019/01/ewjan619oil.png

 

Crude was sharply higher this past week as we reached a high of 49.22 as we closed at the 46.96 level. Level... WITH US LONG!                                                                                          

 

We now show a double 3 wave corrective pattern from the all-time high of 147.27 to the 26.05 low and have labeled this drop as wave A. We are now rallying in a complex wave B that will include a number of 3 wave patterns. This is where we can get options. In terms of counts for our first 3 wave pattern, within wave B, we can consider the following counts:

 

Option 1:

a:

(a) = 51.67;

(b) triangle = 45.58;

(c) =  76.90, if complete, to complete just wave a of our first abc pattern, within wave B;

 

In this option, since wave a is a 3 wave pattern then the wave b drop is going either be a flat or irregular type correction that will see crude fall back the vicinity of 26.05 or even below it before it ends. Wave b could also become a triangle. This is our preferred option, as we have shown it graphically on our Weekly Crude Chart.

 

It is difficult to say what form wave b is going to take. It could be a single (a), (b) ( c) pattern or several separated by a wave (x). For the time being we will stay simple and assume that the current drop is wave (a) of b. After wave (a) ends, which should be very soon, we should expect a wave (b) rally that retraces between 50 to 61.8{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} of the entre wave (a) drop.

 

Option 2:

a = 51.67;

b triangle = 45.58;

c = 76.90, if complete to complete our first abc pattern within wave B.

 

In this option, since we completed a 3 wave option at 76.90, we should expect a wave x drop, that does not need to fall all the back to the 26.05 low to satisfy the rules of EWaves. If we are following this option then we are still now falling in wave (a) of x, however. When wave (a) ends we should expect the same wave (b) rally as Option 1.

 

Wave (a) ended at the 42.36 low, and we are now rallying in a corrective wave (b) rally a shown on the Weekly Crude Chart. The retracement levels for our wave (b) rally have been provided on our Daily Crude Chart. It is still too early to determine what type of corrective pattern our wave (b) rally is going to follow.

 

Suncor:

 

Weekly Suncor Chart: https://captainewave.com/wp-content/uploads/2019/01/ewjan619su.png

 

Suncor was higher this past week reaching a high of 29.36, and almost closing the week off at that high.

 

Our current count for Suncor is suggesting that we are now heading back to the wave a low of 13.10. We have completed wave b of B at the 42.27 high, and are now falling in wave c of B. This count is suggesting that crude will likely he heading back to the 26.05 low also, which is our preferred count in wave b also.

 

Wave c will likely be impulsive which means it will have a 5 wave structure on its way down. Wave (i) ended at the 25.81 low, and we are now rallying in wave (ii). Wave (ii) is expected to retrace between 50 to 61.8{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} of the entire wave (i) drop, with those retracement levels being shown on the Suncor Weekly Chart.

 

Active Positions: Long crude with put at 57.00 as a stop!

 

SP500

 

Weekly SP500 Chart: https://captainewave.com/wp-content/uploads/2019/01/ewjan619sp.png

 

Longer Term Update:

 

It was a wild week again in the SP500 and it rallied sharply to reach a high of 2538.07.   

 

Within wave (iii) we likely completed all of wave .iii. at the 2346.58 low and possibility all of wave .iv. at the 2538.07 high. Wave .iv. now has a completed 3 wave rally pattern. We are now waiting for confirmation that all of wave .iv. is complete at the 2538.097 high.

 

One concern we have with our current wave .iv. interpretation is that the retracement level is very large, well above 38.2{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} and now even above the 50{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} level.

 

As we have indicated in past Morning Posts, it could be possible that only wave *i* of .iii. ended at the 2346.58 low and that we are now rallying in wave *ii*, which could now be complete at the Friday high of 2538.07. Our retracement levels for all of wave *ii* in this option are:

 

50{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} = 2516.00;

61.8{6662cb326f536db879050e93fbe8de36d93608a2a48b01f600643f4328fc39a1} = 2556.00.

 

In this option, once wave *ii* ends we should except a collapse in the SP500 in wave *iii*.

 

We will likely adopt this wave *i*/*ii* count as preferred count next week, after we see how we trade in Monday’s session.

 

Our first projection for the end of wave (iii) is :

 

(iii) = 1.618(i) = 2256.01

 

Active Positions: Very Short.

 

USDX:

 

Weekly USDX Chart: https://captainewave.com/wp-content/uploads/2019/01/ewjan619usd.png

 

Longer Term Update:

 

The USDX was marginally lower this past week as we reached a low of 95.38, as we closed at the 95.75 level.

 

It looks like wave (ii) is completed at the new high of 97.72. If that is the case we should now be falling in the early stages of wave (iii), as shown on the Weekly USDX chart. We seem to be missing the 97.72 high data point on the USDX Weekly Chart.

 

We will provide our first projections for the end of wave (iii) when we are sure that all of wave (ii) is complete.

 

Once the USDX confirms that all of wave (ii) is complete, then we will see gold and silver move sharply higher.

 

Active Positions: Short, risking to 98.55.

 

NG:  

 

https://captainewave.com/wp-content/uploads/2019/01/ewjan619usd.png

Longer Term Update:

 

NG was sharply lower this past week as we reached a low of 2.88.  

 

It is looking like NG just completed another 3 wave rally from 1.61 to the current high of 4.93, and that we are now starting to work on another 3 wave drop that will end at least at the 1.61 low to complete all of wave B. We have shown our initial thoughts on this count in our Monthly NG Chart. We will need to review the internal working of this updated count in our Daily NG Chart in the days ahead.

 

Active Positions: Flat.

 

GDX: 

 

https://captainewave.com/wp-content/uploads/2019/01/ewjan619gdx.png

Longer Term Update:

 

The GDX was higher this past week as we reached a high of 21.54, and we closed the week at the 21.30 level.

 

Looking at the Weekly GDX Chart you can see that we are working on a multi-year wave C rally which is consistent with all of the other counts that we have in the HUI, XAU and most gold stocks. All of the gold indices and gold stock should have or are now completing their respective wave 2 corrections.

 

Once these corrections end, if they have not already done so then the trading strategy will be to buy and hold to capture all of wave 3.

 

Wave 3 should last a year or two and be very sharply higher in price. We have provide our wave 3 projections for many of these markets in our longer term charts. In the case of the GDX this target is 48.60.

 

We will provide more granularity to our 60 min GDX Chart in the days ahead, but we still expect higher prices are we head to our first wave -iii- target of:

 

-iii- = 1.618-i- = 23.49.

 

We expect higher prices next week.

 

A major low in all gold stocks and related indices has occurred, and Subscribers are encouraged to position themselves accordingly.

 

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

 

Note: Next Regular Morning Post will be January 10th, although the Captain will be monitoring the markets from Minneapolis and your Editor will be sending you some key long term gold stock charts from the Captain in the interim!