Technical Analysis Of The Markets

Gold

Short-Term Update

Gold reached a high of 1081.50, at the time that this Post was being written, and is again trying to break above the wave ^i^ of *c* high of 1081.40.

In yesterday’s End of Day Post we had suggested that the impulsive looking rally from the wave ^ii^ low of 1057.50 was NOT complete at the 1083.00 high, and that we expect another run back to the 1083.00 high to complete the minimum requirements for that impulsive sequence.

This current rally could be that next push higher, or we could still be correcting within the current impulsive wave structure and that we will need to wait a little longer for a sharp push above the 1083.00 level. Projections for the end of wave ^iii^ are:

^iii^ = 1.618^i^ = 1113.50. Our preferred;

^iii^ = 2.618^i^ = 1148.10.

Projections of the end of wave *c* are:

*c* = *a* = 1089.80;

*c* =1.618*a* = 1116.20. Our preferred;

*c* = 2.618*a* = 1159.10  

Our current count for wave .b. is as follows:

*a* = 1088.30;

*b* = 1046.80;

*c*:

^i^ = 1081.40;

^ii^ = 1057.50;

^iii^ rally has started.  

It is interesting to note that gold is rallying with the USDX, at the moment.

Longer Term Update:

We have revised our current retracements for the end of wave .b., based on wave .a. ended at 1045.40 

50% = 1118.60;

61.8% = 1135.80.

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

There is an outside chance that all of wave 4 or wave ii of 3 is complete at the 1045.40 low also.

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

Crude

Short-Term Update

Compared to the last couple of session, crude was relatively quiet in the overnight session. We are still looking for one more drop back to at least the 36.23 low, to complete all of wave ^ii^. A drop to our 50 to 61.8% retracement zone of:   

50% = 36.15;

61.8% = 35.62….

…. Is more likely.

Long Term Update:

Our updated current wave (iv), looks like:

-a- = 49.33:

-b-:

*a* = 43.21;

*b* = 50.91;

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

-c-:

*i*:

^i^ = 38.28;

^ii^ is still underway;

^iii^ rally is next.

Projections for the end of wave -c- are:

-c- = 1.618-a- = 52.72;

-c-= 2.618-a- =  64.30: Our preferred target.

Active Trading Positions: Long 15 positions, with 42.00 puts, as stops, plus long 5 positions with 37.00 puts, as stops!                                                                       

S&P500

Short-Term Update

The S&P futures were down about 14 points, in the overnight session, at the time that this Post was being written. We have not exceeded the lows of yesterday’s day session.

We still do not have a valid alternate short term count to share with our Subscribers, at this time, but we are still looking at this drop to be part of a complex wave -iv-.  

Long-Term Update

Likely ending all of most of wave -iv-, with wave -v- higher to begin upon the completion of wave -iv-.

Active Trading Positions: None!

USDX

Short-Term Update:

The USDX has now satisfied the minimum requirements for a completed wave *b*, as we traded above the 99.35 high, reaching 99.40, at the time that this Post was being written.

We are also within 4 ticks of our ideal 61.8% retracement target of 99.44. We expect at all of most of wave *b* is now complete and expect that the next big event in this market will a sharp drop in wave *c*, to complete all of wave .iv.

We are hoping for a little higher push so that we get filled at our 99.45 sell stop.

Long-Term Trading Update:

Our updated current count for wave .iv. is:

*a* = 97.59;

*b* rally is still underway with a minimum target of 99.35.

Retracement for the end of wave *b* are:

50% = 99.10;

61.8% = 99.44.

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.

We are also watching our alternate count, and need to see a drop below the 96.64 high for this alternate to become active.

Active Trading Positions:  Plan to short 5 positions at 99.45, risking to 100.59!

NG

Short-Term Update:

Our current wave *iv* of -a- triangle still remains valid, although in the overnight session we reached  a new low for wave ^e^ of 2.261. Our updated wave *iv* looks like:

^a^ = 2.188;

^b^ = 2.376;

^c^ = 2.240;

^d^ = 2.372;

^e^ = 2.261, if complete.

For this current triangle formation to remain valid we cannot drop below the wave ^c^ low of 2.240, otherwise this triangle formation is likely extending. A drop now below the 2.188 level would eliminate this triangle formation all together.

Upon completion of this wave *iv* triangle, we expect a thrust higher to at least the 2.385 high, to complete all of wave -a-. Once wave -a- ends we expect a drop in wave -b- to retrace between 50 to 61.8% of the entire wave -a- rally, as the next big event.  

We will provide the new retracement zone, for the end of wave -b-, once we are sure that wave -a- is complete.

Long-Term Trading Update:

Our retracement levels for all of wave (iv):

38.2% = 2.91;

50% = 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- is still underway;

-b- drop is next;

-c- rally to at least the wave -a- high, but more likely to our 38.2%/50% retracement zone shown above.

Active Trading Positions: Plan to buy again, when we drop into our yet to determined wave -b- retracement levels!

HUI/GDX/Gold Stocks

Short-Term Update:

If gold breaks above the 1083.00 high, then we should expect a higher GDX and a breakout in Barrick above stiff resistance at 7.86/7.87.

For GDX, a break above 14.29 and then 14.73 would be helpful for the bull case.

We still expect this breakout in Barrick (ABX) to occur, but it just might be delayed by 24/48 hours if gold is correcting within its current impulsive wave sequence.

Long-Term Update:

It looks like wave B for GDX ended at 12.62, and we have started wave C higher!

Within the initial stages of wave C, we have the following count:

-i- = 17.04;

-ii- = 12.92;

-iii-:

.i. = 13.95;

.ii. = 13.19;

.iii.:

*i* = 14.29;

*ii* = 13.57, if complete;

*iii*higher is next.

We need to see a break of 15.61, to confirm our current count for this market....wave B ending at 12.62.

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

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