Elliott Wave Trader: We Expect The Next Silver Rally To Take Us To $18.30/$18.50

First, however, silver needs to put in a close above this level to indicate the fortunes of silver have turned. Here’s the details…

by Captain Ewave of CaptainEwave

Captain Ewave

Elliott Wave Counts For Gold, Silver, & T-Bonds

Email: [email protected]  

Website: www.captainewave.com

GOLD:

 

Short Term Update:

Gold was nicely higher in yesterday’s day session.  In the overnight session we reached a high of 1233.30.

 

Alas, we still believe that wave .ii. is NOT complete at the 1204.00 low. It appears that wave .ii. has become a double 3 wave corrective pattern, which should be very close to ending.

 

Per our wave counts for now, we need to trade to at least the 1204.00 low, one more time, to satisfy the minimum requirements for all of our wave *c* and wave .ii. to be complete.

 

The sentiment for gold is just getting more extreme as gold moves lower, with our calculations showing the record low is 4% bulls, which we will likely reach at the wave .ii. low.  

 

Elliott Wave Theory (EWT) does suggest that at the end of corrective wave .ii.’s that the market psychology is very bearish in a bull market, and even more bearish then at the start of move higher.

 

I believe we have that type of sentiment right now.

 

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 over the next number of months.

 

Long Term Update:

As you can see on the weekly gold chart, wave .ii. has become a double 3 wave corrective pattern, and that is nearing completion.

 

This count suggests we need to see one more drop to at least the 1204.00 low to complete the minimum requirements for all of wave .ii. to become complete.

 

As indicated in our Morning Posts this past week, many technical indicators and sentiment have reached record or near-record extremes in gold, which is suggesting that a reversal in trading direction is very close.

 

Upon completion of wave .ii. we expect a very powerful rally in wave .iii. to be the next major move in this market.

 

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.

Trading Recommendation: Go Long gold. Use puts as stops.

 

Active Positions: We are long, with puts as stops!

 

 

Silver:

Short Term Update:

 

Silver was higher in yesterday’s day session and again in the overnight session as we have reached a high of 15.63.

 

Silver should now be working on its final subdivisions within its wave .ii. correction, although we can now make a case, from an EWave structure point of view, that all of wave .ii. is COMPLETE at the 15.19 low and that we have started wave .iii. higher.

 

A rally and close above the 15.64 low, would be very good sign that the fortunes of silver have started to turn to the upside. Gold can make one more new low without silver having to do the same.

 

Also, 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.  

 

The expected sharp rally in wave .iii. will see us trade well above major resistance at the 18.30/18.50 level.

 

Trading Recommendation: Long silver. Use a put as a stop.

 

Active Positions: We are long, with puts as stops!

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.

 

 

Free Offer For Website Readers:  Send me an email to [email protected] and I’ll send you our “Nailing The GDX Low!” report.  I highlight key short-term wave counts for GDX as it moves towards our key final low number, and good times begin!

Thank-you!

Captain Ewave & Crew!

Email: [email protected]

Website: www.captainewave.com

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