Captain Ewave says aggressive traders should consider going long in both gold & silver. Here’s what the technicals are telling him…
Short Term Update:
If we are in the initial stages of wave .iii., we should expect a very large up day from gold this week, and a retaking of the 1204.00 level as a first step.
We are now challenging that high, and we will see if we break through and close above it in today’s trading session. We will provide our initial projections for the end of wave .iii. only when we are sure that all of wave .ii. is complete at the 1167.10 low.
We still cannot rule the possibility now that wave -ii- did not end at the 1124.30 low and that gold may be heading to that low, one more time, to complete all of our wave -ii- correction.
This will be our alternate count for the time being. Gold remains acutely oversold and at record extremes along with various other technical indicators, which is foretelling of a sharp rally ahead… but a final panic selloff may still occur!
Upon completion of wave .ii. we expect to see gold trade above very strong resistance at the 1360.00/1370.00 level, and likely into the 1500.00 area.
Long Term Update:
Gold has reached 1167.10, and rallied strongly from there.
We have now satisfied the minimum requirements for a completed wave .ii. correction at the 1167.10 low.
So, we are waiting for confirmation that wave .ii. is complete at this low, and that a very strong wave .iii. rally has begun.
We are also watching for the possibility that wave -ii- did NOT end at the 1124.10 low, and in this case, wave -ii- would have become a complex flat correction. This has been, and still is, our alternate count.
Longer term, our first and second projections for the end of wave -iii-, as shown on the weekly gold chart, are:
Trading Recommendation: Go long gold. Use put options as stops. Aggressive traders should consider adding to long positions here.
Active Positions: We are long, with puts as stops.
Short Term Update:
Silver has been moving sideways over the last couple of trading sessions, and we are expecting silver to move sharply higher after breaking above the 14.83 level. Our intraday charts are suggesting higher prices ahead.
We have updated our count for all of wave ii to show a double 3 wave complex correction. This corrective pattern could be complete at the 14.31 low, and if that is the case then we should now be starting to move higher in our expected wave iii. rally.
A rally above the 15.25 level would likely confirm to us that all of wave ii is complete at the 14.31. low.
Like gold, silver has many indicators at extreme/record levels, which is also indicating a likely reversal in trading direction to the upside is imminent.
We will provide our initial projections for the end of wave .iii., when we are sure that all of wave .ii. is complete, at the 14.31 low. The expected sharp rally in wave .iii. will see us trade well above major resistance at the 18.30/18.50 level.
Long Term Update:
Silver hit 14.31 last week, and that made it appear that wave ii was still underway, as shown on the weekly chart. That drop to 14.31 has satisfied the minimum requirements for a completed wave ii, and we are now waiting for confirmation that wave iii higher has begun.
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% of the entire wave 1 rally.
3 rally has now begun.
Trading Recommendation: Go long silver. Use a put as a stop. Aggressive traders should consider adding to long positions here.
Active Positions: We are long, with puts as stops!
Free Offer For Website Readers: Send me an email to [email protected] and I’ll send you our “Gold Stocks Blastoff?” report. I highlight the key short-term wave counts for GDX, and long-term counts for HUI and XAU, with analysis of why the imminent rally will have legs!
Captain Ewave & Crew!
Email: [email protected]
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