Technical Analysis Of Major Markets

Gold

Gold was flat in the overnight session, but the wave patterns on the Intraday Chart suggest still higher prices in this up leg.  Our next targets are 1085.00 and 1088.20. We are working on the assumption that all of wave .a. of –v- ended at 1046.40 and we are now rallying in wave .b..

Retracements for the end of wave .b. are:

50% = 1119.10;

61.8% = 1136.20.

Wave .b. is expected to consist of at least one *a*, *b*, *c* pattern.

There is also an outside chance that all of wave 4 or wave ii of 3 is complete at the 1046.40 low.

The Commitment of Traders(Managed Money), which started being tracked in 2006, is at a record low for gold.  Almost everyone predicts gold is going much lower, except for the Captain and his crew!

We are long 20 positions, with puts at 1085.00!

Crude Oil

Crude had a contract rollover on the continuous chart, which has added about $1.50 to the value of the front month. In that contract, crude reached a high of 36.26.

We do not see a clear impulsive wave structure on the Intraday Chart from the 33.98 low to the current highs. That does not mean there is not one coming, but that it could still be developing.

More time is needed to see if the 33.98 low is a lasting one.   

Our current wave (iv), looks like:

-a- = 49.33:

-b-:

*a* = 43.21;

*b* = 50.91;

*c* ending diagonal triangle = 33.98, if complete, to complete all of wave -b-;

-c- rally is next.

We will provide our projections for the end of wave -c- . when we are sure that wave -b- is complete. Wave -c- is still expected to be a very sharp rally higher, with a run to the $60/65 area likely.

Wav (iii) in NG may now be complete, so we will see how this affect crude moving forward.

We are long 15 positions, with 42.00 puts, plus 5 positions with 37.00 puts, as stops!                                                                           

S&P 500

The S&P Futures we flat in the overnight session, as we continue to assume that all of wave .b. is complete at the 2005.48 low.

If this assumption is correct, then we should now rally sharply in wave .c. to all time new highs to end all of wave B. 

From those highs, we expect a 1929 type of crash to unfold!

USDX

The USDX has continued its slow drift lower, reaching 98.22, at the time that this Post was being written.

We have lowered our stop on our short positions to 99.40!

We are starting to have some doubts about whether wave .iv. ended at 97.21, and in fact we are starting to think that a major top in the USDX was made at 100.71.

We have been working on some alternates that we will likely Post later this week or over the Christmas holidays, but will say that these alternates suggest that the USDX could be heading back to the 80.00/85.00 area!

We still have a number of Options relative to this market, which we will review in this discussion. 

Our current preferred option is that we are still working on wave .iv., with the following internal wave count: 

*a* = 97.59;

*b* = 99.35, if complete;

*c* drop to go, to at least the 97.21 low.

Wave *c* cannot drop below the wave .i. high of 96.64, or something else is going as it relates to the end of wave .iv.

If that drop was to happen then it is likely that we will be following the red Option shown on the attached Weekly USDX Chart.

In this case we would be dropping in a protracted wave .c., that would have a minimum target of 92.52. In term of our current preferred count, the rally within wave *b* has reached our 50 to 61.8% retracement zone of 99.09 to 99.44, with a current high of 99.35.

On the Intraday Chart it is not clear as to whether wall of wave *b* is complete at the 99.35 high, or whether we will challenge that high one more time before wave *b* ends. A drop below 98.61, would suggest that all of wave *b* is complete at the 99.35 high.

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 option is that wave .iv. did end at the 97.21 low and we are working higher in wave .v. to at least the 100.71 wave -iii- high.

We are short 5 at 99.25, risking to 99.40!

NatGas

 

NatGas reached a low of 1.881, in the overnight session, at the item that this Post was being written. If we have now completed an impulsive wave structure from 1.693 to 1.944, then we should expect a correction that retraces between 50 to 61.8% of that previous move higher.

Those retracements are: 

50% = 1.819;

61.8% = 1.789.

It could still be possible that the impulsive wave structure that we are talking about is still not complete at the 1.994 high, and that is it going to extend higher, before we get our 50 to 61.8% corrective retracement.

We will still give this market a little more time before we officially declare wave (iii) complete at the 1.693 low.

Upon completion of wave (iii), we will give our projections for the end of wave (iv), which will be a retracement that ranges between 23.6% and 38.2% of the entire wave (iii) drop.

A 50% retracement could be possible in this market also. The wave (iv) rally should reach the 3.00 to 3.50 level. 

We are long 5 positions, with 1.800 puts as stops!

Gold Stocks

For several years, our main focus in the gold stocks sector, even more than GDX, is our bellwether junior gold miner: CRJ, which is performing like a champ!

We look to CRJ to function as a beacon of leadership, for the entire sector.

As you can see on the attached daily CRJ Chart, if we are working on a wave -iv- triangle then we should be fast approaching the end of wave *d* of that triangle.

Although an ideal place for wave *d* to end would be at the red upper trend line it can rally as high as wave *b*, which is 0.82.

If it rallies above 0.82 now, then our wave -iv- triangle is eliminated. The important aspect of this chart, is that if our analysis is correct, then upon completion of the wave -iv- triangle, we should expect a sharp wave –v- thrust higher to our wave (iii) target of 0.98.

For this to happen we would probably need to see gold explode higher….

Is something going to happen to get gold to do that early in 2016? We are watching, and the wave counts suggest it is very likely!

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

Best wishes to the entire gold community for a happy & prosperous 2016!

********

Email: [email protected]

Website: www.captainewave.com

Risk: CAPTAINEWAVE.COM IS AN IMPERSONAL ADVISORY SERVICE. AND THEREFORE, NO CONSIDERATION CAN OR IS MADE TOWARD YOUR FINANCIAL CIRCUMSTANCES. ALL MATERIAL PRESENTED WITHIN CAPTAINEWAVE.COM IS NOT TO BE REGARDED AS INVESTMENT ADVICE, BUT FOR GENERAL INFORMATIONAL PURPOSES ONLY. TRADING STOCKS DOES INVOLVE RISK, SO CAUTION MUST ALWAYS BE UTILIZED. WE CANNOT GUARANTEE PROFITS OR FREEDOM FROM LOSS. YOU ASSUME THE ENTIRE COST AND RISK OF ANY TRADING YOU CHOOSE TO UNDERTAKE. YOU ALSO AGREE TO BEAR COMPLETE RESPONSIBILITY FOR YOUR INVESTMENT RESEARCH AND DECISIONS AND ACKNOWLEDGE THAT CAPTAINEWAVE.COM HAS NOT AND WILL NOT MAKE ANY SPECIFIC RECOMMENDATIONS OR GIVE ADVICE TO YOU OR ANY OF ITS CLIENTS UPON WHICH THEY SHOULD RELY. CAPTAINEWAVE.COM SUGGESTS THAT THE CLIENT/MEMBER TEST ALL INFORMATION AND TRADING METHODOLOGIES PROVIDED AT OUR SITE THROUGH PAPER TRADING OR SOME OTHER FORM OF TESTING. CAPTAINEWAVE.COM, ITS OWNERS, OR ITS REPRESENTATIVES ARE NOT REGISTERED AS SECURITIES BROKER-DEALERS OR INVESTMENT ADVISORS EITHER WITH THE U.S. SECURITIES AND EXCHANGE COMMISSION OR WITH ANY STATE SECURITIES REGULATORY AUTHORITY. WE RECOMMEND CONSULTING WITH A REGISTERED INVESTMENT ADVISOR, BROKER-DEALER, AND/OR FINANCIAL ADVISOR. IF YOU CHOOSE TO INVEST WITH OR WITHOUT SEEKING ADVICE FROM SUCH AN ADVISOR OR ENTITY, THEN ANY CONSEQUENCES RESULTING FROM YOUR INVESTMENTS ARE YOUR SOLE RESPONSIBILITY.

ALL INFORMATION POSTED IS BELIEVED TO COME FROM RELIABLE SOURCES. CAPTAINEWAVE.COM DOES NOT WARRANT THE ACCURACY, CORRECTNESS, OR COMPLETENESS OF INFORMATION AVAILABLE FROM ITS SERVICE AND THEREFORE WILL NOT BE LIABLE FOR ANY LOSS INCURRED. DUE TO THE ELECTRONIC NATURE OF THE INTERNET, THE CAPTAINEWAVE.COM WEBSITE, ITS E-MAIL & DISTRIBUTION SERVICES AND ANY OTHER SUCH "ALERTS" COULD FAIL AT ANY GIVEN TIME. CAPTAINEWAVE.COM WILL NOT BE RESPONSIBLE FOR UNAVAILABILITY OF USE OF ITS WEBSITE, NOR UNDELIVERED E-MAILS, OR "ALERTS" DUE TO INTERNET BANDWIDTH PROBLEMS, EQUIPMENT FAILURE, OR ACTS OF GOD. CAPTAINEWAVE.COM DOES NOT WARRANT THAT THE TRANSMISSION OF E-MAILS, OR ANY "ALERT" WILL BE UNINTERRUPTED OR ERROR-FREE. CAPTAINEWAVE.COM WILL NOT BE LIABLE FOR THE ACTS OR OMISSIONS OF ANY THIRD PARTY WITH REGARDS TO CAPTAINEWAVE.COM DELAY OR NON-DELIVERY OF THE CAPTAINEWAVE.COM NIGHTLY EMAILS OR "ALERTS". FURTHER, WE DO NOT RECEIVE ANY FORM OF PAYMENT OR OTHER COMPENSATION FOR PUBLISHING INFORMATION, NEWS, RESEARCH OR ANY OTHER MATERIAL CONCERNING ANY SECURITIES ON OUR SITE OR PUBLISH ANY INFORMATION ON OUR SITE THAT IS INTENDED TO AFFECT OR INFLUENCE THE VALUE OF SECURITIES.

THERE IS NO GUARANTEE PAST PERFORMANCE WILL BE INDICATIVE OF FUTURE RESULTS. NO ASSURANCE CAN BE GIVEN THAT THE RECOMMENDATIONS OF CAPTAINEWAVE.COM WILL BE PROFITABLE OR WILL NOT BE SUBJECT TO LOSSES. ALL CLIENTS SHOULD UNDERSTAND THAT THE RESULTS OF A PARTICULAR PERIOD WILL NOT NECESSARILY BE INDICATIVE OF RESULTS IN FUTURE PERIODS. THE RESULTS LISTED AT THIS WEBSITE ARE BASED ON HYPOTHETICAL TRADES. PLAINLY SPEAKING, THESE TRADES WERE NOT ACTUALLY EXECUTED. HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN INHERENT LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED TRADES DO NOT REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT ACTUALLY BEEN EXECUTED, THE RESULTS MAY HAVE OVER OR UNDER COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS SUCH AS LACK OF LIQUIDITY. YOU MAY HAVE DONE BETTER OR WORSE THAN THE RESULTS PORTRAYED. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFITS OR LOSSES SIMILAR TO THOSE SHOWN. NO INDEPENDENT PARTY HAS AUDITED THE HYPOTHETICAL PERFORMANCE CONTAINED AT THIS WEBSITE, NOR HAS ANY INDEPENDENT PARTY UNDERTAKEN TO CONFIRM THAT THEY REFLECT THE TRADING METHOD UNDER THE ASSUMPTIONS OR CONDITIONS SPECIFIED HEREAFTER. WHILE THE RESULTS PRESENTED AT THIS WEBSITE ARE BASED UPON CERTAIN ASSUMPTIONS BELIEVED TO REFLECT ACTUAL TRADING CONDITIONS, THESE ASSUMPTIONS MAY NOT INCLUDE ALL VARIABLES THAT WILL AFFECT, OR HAVE IN THE PAST AFFECTED, THE EXECUTION OF TRADES INDICATED BY CAPTAINEWAVE.COM. THE HYPOTHETICAL RESULTS ON THIS WEBSITE ARE BASED ON THE ASSUMPTION THAT THE CLIENT BUY AND SELLS THE POSITIONS AT THE OPEN PRICE OF THE STOCK. THE SIMULATION ASSUMES PURCHASE AND SALE PRICES BELIEVED TO BE ATTAINABLE. IN ACTUAL TRADING, PRICES RECEIVED MAY OR MAY NOT BE THE SAME AS THE ASSUMED ORDER PRICES.