Oil Gaining Traction

Oil had been in brutal 8 week decline. Oil seems to have bottomed and is gaining traction.

Oil printed its lowest point on day 73, which was very deep in its timing band for a DCL. Oil has formed a swing low and has since been crawling along the 10 day MA — turning it higher which signals that day 73 was the daily cycle low. Oil should break above the declining trend line for final confirmation of the DCL.

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Gold Poised for a Daily Cycle Decline

Gold formed a daily swing high on Tuesday.

Tuesday was day 18 for the daily gold cycle. That places gold in the early part of its timing band for a daily cycle decline. A peak on day 17 indicates a right translated daily cycle formation which aligns with gold being in a daily uptrend. A close below the breakout level would be a clear indication that gold has begun its daily cycle decline. Gold will remain in its daily uptrend long as it forms a swing low above the lower daily cycle band.

1 Step Backwards for 2 Steps Forward

Stocks printed their lowest point on week 38.
In real time it looked like stocks printed their intermediate cycle low.
Then on Monday – Stocks broke below the week 38 low.

It appears that stocks are taking a step backwards so they can take 2 steps forward.

In the Weekend Report we discussed how stocks have not yet confirmed that week 38 was the intermediate cycle low. Therefore, stocks breaking below the week 38 low extends the intermediate cycle decline. It has been 6 weeks since stocks printed the week 38 low. If stocks did not undercut that low, then 6 weeks would have been lost to volatility. But since this extends the intermediate cycle — once the daily cycle low forms, it will signal a new intermediate cycle. Which would give stocks a fresh set of weeks for their intermediate cycle advance.

The 12/07/18 Weekend Report Preview

The Dollar

After rallying on Monday, the dollar declined into Friday.

The dollar lost the 10 day MA on Thursday and delivered more bearish follow through on Friday indicating that the dollar has begun its daily cycle decline. The peak on day 5 indicates a left translated daily cycle formation. With Friday being day 11, the dollar could trend lower for the next 3 to 4 weeks before printing its DCL. The dollar currently is in a daily uptrend. It will remain in its uptrend unless it closes below the lower daily cycle band.

Stocks

I believe that stocks printed an intermediate cycle low on 10/29/18. However, both the Russell and the Banking index have broken below their October lows to form failed daily cycles.

The continued volatility has obscured our daily cycle count. I believe that Friday should be day 27, placing stocks 3 days shy of its timing band for a DCL. What is clear is that stocks are in a daily downtrend. They will remain in their daily downtrend until they close back above the upper daily cycle band.

The entire Weekend Report can be found at Likesmoney Subscription Services

The Weekend Report discusses Dollar, Stocks, Gold, Miners, Oil, & Bonds in terms of daily, weekly and yearly cycles.
Also included in the Weekend Report is the Likesmoney CycleTracker

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You can email me at likesmoney@gmail.com to receive a sample copy of the Weekend Report

Stocks Print Bullish Reversal

I believe that stocks printed an intermediate cycle low on 10/29/18. The volatility since then has obscured our daily cycle count. However, Thursday’s bullish reversal may provide some clarity.

With stocks closing below both the 200 day MA and the 10 day MA as it declined into the day 18 low looked in real team as if stocks were printing an early DCL. But an 18 day DCL was really too early for a DCL to print. On the other hand we have seen daily cycle lows form as early as day 23, so a DCL here on day 26 is certainly possible.

26 days would place stocks a bit early for the normal timing band for a DCL. But following an extended daily cycle this would help to balance out the cycles. There are also bullish divergences developing on the oscillators, which often occur at cycle bottoms. So a swing low and close above the 10 day MA will have us label day 26 as the DCL. A break above 2696.15 forms a daily swing low.

Market Volatility

Stocks dropped over 3% on Monday, continuing the volatility we have seen since early October.

I believe that stocks printed an intermediate cycle low on 10/29/18. With stocks closing above both the 50 day MA and the 200 day MA on Friday, it appeared as if stocks printed an early daily cycle low on 11/23/18. But Monday’s drop has obscured our daily cycle count.

So let’s turn to the weekly chart.

Stocks did break above the declining weekly trend line confirming that week 38 hosted the ICL. So unless stocks break below the ICL of 2603.54, I would maintain that this is volatility associated a difficult bottoming process.

Oil Forms a Swing Low

After forming a swing high in early October, oil has been in a brutal daily downtrend.

Oil as been tending lower for over 40 days. Oil printed it lowest point on Thursday, day 73, placing oil very deep in its timing band for a DCL. The bullish divergences developing on the oscillators accompanied by Monday’s swing low and close above the 10 day MA indicate oil has printed its daily cycle low. I suspect that oil is printing something more significant than a daily cycle low. Which was something that I discussed in the Weekend Report.

The 12/01/18 Weekend Report Preview

The Dollar

The last time the dollar delivered clarity for a daily cycle low was the September DCL.

Since the September low, the dollar has been firmly in a daily uptrend. Assuming that day 25 was the DCL, that sets up a possible left translated daily cycle formation for the dollar. A break below the daily cycle trend line would signal the daily cycle decline.

Stocks

Following the day 7 peak, stocks closed below both the 200 DMA and the 10 DMA and turned the 10 DMA lower to indicate that stocks were declining into a daily cycle low.

I am not comfortable labeling day 18 as the DCL. However, cycles often will balance out an extended daily cycle with a shortened cycle and the previous cycle did extend out to day 52. Setting aside the daily cycle count, the day 18 low does satisfy the other criteria for a DCL. But due to the proximity of the 200 DMA and the 50 DMA, I would like to see a close above these two moving averages for confirmation of the DCL.

Stocks delivered a signal Friday for more volatility. Stocks printed 616 million Selling on Strength on Friday. Stocks are in a daily downtrend and facing resistance from both the 200 MA and the declining 50 day MA. Rejection by the 200 MA would indicate that day 18 was a half cycle low.

The entire Weekend Report can be found at Likesmoney Subscription Services

The Weekend Report discusses Dollar, Stocks, Gold, Miners, Oil, & Bonds in terms of daily, weekly and yearly cycles.
Also included in the Weekend Report is the Likesmoney CycleTracker

For subscribers click here.

You can email me at likesmoney@gmail.com to receive a sample copy of the Weekend Report

Is Oil Ready To Rise?

Oil was already in its timing band for a DCL when the daily cycle peaked. Once oil closed below the 10 day MA to begin its daily cycle decline I began looking for potential spots for oil to form a swing low. There were 5 times during the 37 day decline that oil traded sideways, which would ease the parameters for forming a swing low. And each time oil broke lower, until Tuesday.

So after declining for 37 days oil maybe finally ready to rally.

There are bullish divergences developing on the oscillators which normally herald a cycle low. Oil printed its first swing low on Tuesday since closing below the 10 day MA. The swing low formed off of the day 70 low, which was well past the normal timing band for a daily cycle low. A close above the 10 day MA will signal a new daily cycle.

More Bullish Conviction

Some fear that stocks have entered a bear market. I believe that stocks are emerging from an intermediate cycle low and just successfully retested those lows. The decline into Friday looked in realtime like a left translated, failed daily cycle was unfolding. But Monday’s swing low signals a new daily cycle. A break of the declining trend line will have us label Friday as an early DCL.

While both the transports and the banks did break lower, they did not sell off as deeply as stocks. And both have already recovered their respective 10 day MA’s leading the way for stocks to follow.

And the NYMO gives us reason for more bullish conviction.

We have discussed previously how the NYMO delivered the most powerful thrust out of a cycle low since the 2016 4 year cycle low. We can see that while stocks did test the recent low, there is a huge bullish divergence emerging on the NYMO that signals a rally is to follow.