Technical Analysis Of Major Markets

GOLD

Gold failed to rally above the 1174.00 area and it seems likely now that we are probably going to revisit the 1162.00 area again.

It is still possible that we are going to drop back to the 1155.80 also.

Only a break now of the 1174.40 high, would get us excited about buying again.

No change to our current 5 long positions, risking to 1141.50!

CRUDE OIL

Crude dropped to new a low of 52.10, at the time that this Post was being written, in the overnight session.

As you can see on the attached Daily Crude Chart, we now believe that wave –iv- consists of a series of .a., .b., .c. patterns, separated by .x. waves. From our wave -iii- low of 44.20, these series of .a., .b., .c. patterns looks like:

.a. = 51.20;

.b. = 43.58;

.c. = 54.24;

.x. = 42.11;

.a. = 52.48;

.b. = 47.05

.c. = 62.58

.x. is now. Our *c*=2.618*a* projection is 49.95, and we will try to buy in that area, to capture the next wave .a. up.

Upon completion of our second .x. wave crude should rally one more time in another .a., .b., .c. pattern to at least the 62.58, to complete all of wave -iv-.  

S&P500

In terms of our current thinking we still believe that we are in wave .ii., and that the S&P should rally at least back to the wave *a* high of 2085.06, although we suspect it will reach at least our 50% retracement level of 2093.26.

Wave .ii. currently looks like: 

*a* = 2085.06;

*b* = 2058.00;

*c* is now and needs to rally to at least the wave *a* high of 2085.06, but more likely into our 50 to 61.8% retracement zone of:

50% = 2093.26;

61.8% = 2101.90.

Some projections for the end of wave *c*: 

*c* = *a* = 2086.43

*c* = 1.618*a* = 2104.00.

We plan to add 3 more short positions at 2097.00.

A break below the overnight low of 2058.00, now, would suggest that wave .iii. is likely underway and we are going sharply lower in the days ahead.

We cannot rule the possibility that this wave -v- ending diagonal triangle is simply extending and that the S&P will make all time new highs in the months ahead. For the time being this will be our alternate scenario.

Key Intraday Alert:  It is starting to look like wave .ii. ended at 2085.06. We would now be falling in wave .iii.

If that is the case some projections for the end of wave .iii. are:

.iii. = .i. = 2011.83;

.iii. = 1.618.i. = 1966.57;

.iii. = 2.618.i. = 1893.34.

We are short 3 SP500positions at 2115, and 5 at 2070, risking all to 2086.00.  We’re up over $150,000 on this great trade!!

USDX

 The USDX continued to rally in the overnight session, reaching 97.40 at the time that this Post was being written.

In yesterday’s End of Day Post we revised our wave -iv- count to suggest that wave *b* was becoming a triangle, and for the time being we see no reason to change that outlook.

Only a break of 98.00, would eliminate our wave *b* triangle thinking.

Our current count within wave -iv- as follows:

*a*:

^a^ = 94.88;

^b^ = 100.27;

^c^  = 93.16, to complete all of wave *a*; 

*b* triangle:

^a^ = 98.00;

^b^ = 93.30;

^c^ = 97.40, if complete.

^d^ is now;

^e^ to go to complete all of the wave *b* triangle. 

*c* drop to go, to least the wave *a* low of 93.16, to complete all of wave -iv-

If wave ^c^ is not complete at the 97.40 high, it cannot rally above the wave ^a^ high of 98.00 and wave ^d^ cannot drop below the wave ^b^ high of 93.30, for this triangle formation to remain valid.

NATGAS

NG rallied to 2.80 in the overnight session before then turning lower. We are working on the assumption that our wave -iv- triangle ended at 2.89 and that we are now dropping in wave -v-.

On the Intraday Chart the drop from 2.89 to the current low of 2.73 looks like an incomplete impulsive move lower.

A drop now below 2.73, would complete the minimum requirements for a five wave impulsive sequence, after which we should see a corrective rally that should retrace between 50 to 61.8% of the prior impulsive wave drop.

The other Option is that the current wave -iv- triangle is not complete, although a break of the 2.71 low would be the first sign that this triangle is not extending.

We have shorted 5 positions, risking to 2.90!

HUI/GDX

 We need see continued movement higher if we are in wave c.

We are very long the GDX, risking to 16.00!

SUNCOR

We are short Suncor, risking to 33.50, but will be adding to our short positions at 26.00.  Profits on this trade are really piling up!

BARRICK

We have gone long Barrick, and are looking for a low very soon.

That’s a shorter term look at Barrick.  The bottom line:

From the inception of the stock, we have been working on a multi-decade ABC pattern, with wave A ending in 2008 at 49.72 and wave B ending in 2014, at 9.96. We then and now are predicting a huge rally in wave C. We have projections for the end of wave C ranging from 60.20 to 140.06. Since we are predicting a wave C rally it is expected to be a multi-year impulsive type rally. 

Since we first published the Long term EWave Chart of ABX, the stock has really gone nowhere, since its 9.96 low. We did rally to 13.14, out of the 9.96 low and then have gone up and down a couple of times.

We should expect a very large and powerful rally in wave iii, to begin this week, and likely last until the end of 2015. If the S&P has topped and gold has bottomed in the $1150 -$1155 area, then the signs could be in place for this expected wave iii rally.

Once we know where wave ii ends we will provide projections for the end of wave iii, but in general they will be:

iii= 1.618i;

iii= 2.168i;

iii= 4.326i;

iii = 6.25i.

Trading Strategy: Long ABX, risking all to 9.95!!

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