Swing Low

When stocks dropped almost 6% on June 11th to close below the 200 day MA it looked as if stocks were well on their way to an intermediate cycle decline. Stocks regained the 200 DMA on the 12th and printed a bullish reversal on the 15th, which was day 21. Since 21 days was too early for a daily cycle low we noted that it appeared that the Fed was able to dodge a bullet by preventing stocks from crashing into an intermediate cycle low.

The rally out of the day 21 low was short lived as stocks lost the 200 day MA again on Friday. If stocks were able to deliver bearish follow through on Monday, the 50 day MA could have been lost sending stocks into an intermediate cycle decline. Instead, the 200 day MA was successfully defended on Monday. Stocks delivered bullish follow through on Tuesday by forming a swing low and closing above the 10 day MA. If stocks can close above the declining trend line then we would recognize that stocks have begun a new daily cycle.

And if they do close above the declining trend line, it would look like the Fed managed to dodge another bullet.

Miner Facts

The Miners formed a swing low on Monday.

After peaking on day 12, the Miners drifted lower, forming a mini bull flag. The Miners printed a bullish reversal off of support from the converging 10 day MA and 50 day MA on Friday. On Monday, they delivered bullish follow through by forming a swing low. Monday’s swing low allows us to construct the daily cycle trend line. A break below the daily cycle trend line will signal the daily cycle decline. However, the Miners are in a daily uptrend. Forming a swing low above the upper daily cycle band indicates that the Miners will remain in their daily uptrend and trigger a cycle band buy signal.

The 6/27/20 Weekend Report Preview

The Dollar

 
The dollar formed a swing high on Monday then delivered bearish follow through by closing below the 10 day MA on Tuesday.

The dollar then rallied on Wednesday, closing back above the 10 day MA and continued higher into the close on Friday. This allows us to construct the daily cycle trend line. A break below this trend line will signal the daily cycle decline. The dollar currently in a daily downtrend. The dollar will remain in its daily downtrend unless it closes back above the upper daily cycle band.

Stocks

The rally out of the day 21 low did not manage to turn the 10 day MA higher.

While stocks closed higher on Monday and Tuesday, they lost the 10 day MA on Wednesday. Thursday’s bullish reversal off of support from the 200 day MA looked, in real time, as if the Fed managed to to save the market from further decline. Then stocks broke lower on Friday, closing below the 200 day MA. Friday was day 30, which places stocks in the early part of its timing band for a daily cycle low. Stocks should go on to break below the day 21 low of 2965.66 in order to form its daily cycle low. Currently, stocks are in a daily uptrend. But a close below the lower daily cycle band will end the daily uptrend and begin a daily downtrend.

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

Gold Update

Is gold ready to begin a trending move?

Gold had been contained by the 1750 resistance level for the prior 11 weeks. Gold is in position to close above 1750 resistance level on a weekly basis. A close above this resistance level is necessary for a trending move to develop. Currently, gold is in a weekly uptrend. Gold will remain in its weekly uptrend unless it closes below the lower weekly cycle band.

Fed To The Rescue – Again

When stocks dropped almost 6% on June 11th to close below the 200 day MA it looked as if stocks were well on their way to an intermediate cycle decline. Stocks regained the 200 DMA on the 12th and printed a bullish reversal on the 15th. Once a swing low on the 16th formed we noted that it appeared that the Fed was able to prevent stocks from crashing into an intermediate cycle low.

Once again the Fed has defended the 200 day MA.

Stocks printed their lowest point on day 21, which is too early to expect a DCL. The rally out of the day 21 low did not managed to turn the 10 day MA higher. When stocks lost over 2.5% on Wednesday it looked stocks were going to compete their daily cycle decline and it was like deja vu all over again. Then stocks printed a bullish reversal off of the 200 day MA on Thursday. This bullish reversal has already caused the 10 DMA to turn higher. If stocks can form a swing low and close above the declining trend line then it will look as if the Fed has managed to form an early daily cycle low.

Stocks are in a daily uptrend that has been characterized by highs occurring above the upper daily cycle band and lows forming above the lower daily cycle band. If a swing low forms here, above the lower daily cycle band, then stocks will remain in their daily uptrend and trigger a cycle band buy signal.

Bearish Divergence On Oil

Oil printed a new daily cycle high on Tuesday.

Tuesday was day 44 for the daily oil cycle. That places oil in its timing band for a daily cycle low. The bearish divergence on the oscillators at this late stage of the daily oil cycle signals a pending cycle decline. A swing high and a close below the 10 day MA should send oil into its daily cycle decline. A break below 39.76 forms a daily swing high. Oil is currently in a daily uptrend. If oil closes below the lower daily cycle band that will end the daily uptrend and begin a daily downtrend.

Gold Delivers Bullish Follow Through

Gold closed at 1753 on Friday and delivered bullish follow through on Monday.

Gold clearly broke above the 12 week resistance level on Monday. We discussed on Thursday that a weekly close above the 1750 resistance level will be our buy signal. And Monday’s rally got gold off to a good start. Keep in mind that over the past 12 weeks gold has pierced the 1750 resistance level several times, but did not hold on for a weekly close above the resistance zone. This is why we are looking for a weekly close, not a daily close, above the resistance level. Because at 14 weeks, if gold closes back below the multi week resistance zone then gold would be at risk for continuing down into an intermediate cycle decline.

The 6/20/20 Weekend Report Preview

The Dollar

 
After losing the 10 day MA on Monday, the dollar regained it on Tuesday and continued higher through Friday.

This week’s rally has managed to turn the 10 day MA higher which confirms day 27 as the daily cycle low. The dollar currently in a daily downtrend. The dollar will remain in its daily downtrend unless it closes back above the upper daily cycle band.

Stocks

Stocks have not confirmed if day 21 was an early DCL.

While Monday’s bullish reversal closed convincingly above 200 day MA, stocks did not close above the 10 day MA this week. Friday’s bearish close caused the 10 day MA to turn lower, indicating a continuation of the daily cycle decline. A daily swing high off of Friday’s candle could set up the declining trend line. Currently, stocks are in a daily uptrend. They will remain in their daily uptrend unless the close below the lower 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

For subscribers click here.

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

Gold Buy Signal

Thursday was day 9 for the daily gold cycle. The current daily cycle high on day 4 threatens a left translated daily cycle formation. But tonight I want to look at the weekly chart.
 

This is week 13 for the intermediate gold cycle. Gold has been contained by the 1750 resistance level for 11 weeks. The 10 week MA has flatten and is at risk of turning lower. With each passing week that gold does not break above the 1750 resistance level makes it more likely that the gravitational pull from the pending intermediate cycle low will begin to pull gold lower. A close below the 10 week MA will signal the intermediate cycle decline.

What we need to see is a weekly close above the 1750 resistance level. That will be our buy signal. A weekly close above the 1750 resistance level should result in a trending move. Currently, gold is in a weekly uptrend. Gold will remain in its weekly uptrend unless it closes below the lower weekly cycle band.

Fed To The Rescue

Stocks formed a swing low on Tuesday.

We discussed on Monday why I felt that the Fed could not let the markets develop any bearish follow through to Thursdays’ huge drop. Stocks forming a swing low on Tuesday signals that the Fed has managed to abort (for now) an intermediate cycle decline by forcing stocks to print, what I believe is, an early daily cycle low.

While it is debatable that 21 days is too early for a DCL and should only be a half cycle low. What is not debatable is the quick bullish reversal on RSI that is characteristic of a bullish pattern that occurs during the advancing phase of an intermediate cycle. Which aligns with stocks currently being in a daily uptrend. And since a swing low has formed above the lower daily cycle band, stocks remain in their daily uptrend and trigger a cycle band buy signal.