Miner Possibilities

0 miner surprisehttp://postimg.org/image/3lpuhkw3z/

We last week’s post, Major or Miner Resistance, we looked at how the Miners were being turned back at the 50 week MA.

gdx weekly

http://postimg.org/image/mbta2xp5j/

Losing the 50 week MA ushered in the last 2 intermediate cycle declines. And the Miners are in jeopardy of being rejected by the 50 week MA here. However, there is a bullish scenario to consider.

gdx

http://postimg.org/image/6qh0g3jiv/

The daily Miner cycle peaked on day 23 and then it began its daily cycle decline. This decline is better characterized as a crawl more so than a decline. I make that distinction because crawl patterns are usually continuation patterns.

Day 29 was the lowest point following the day 23 peak. The swing low that followed the next day made it look in “real time” to be the daily cycle low. But the Miners could not break above the 200 MA.

The bullish scenario would be to see the Miners print a lower low, breaking below the day 29 low of 21.08 and then print a bullish reversal. That would extend the daily cycle out. A swing low and declining trend line break would then confirm a new daily cycle.

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5 thoughts on “Miner Possibilities

  1. Hi,
    I can see how a break of the Day 29 low of 21.08 followed by a reversal would set up an extended daily cycle and a new daily cycle.

    But a break of 21.08 would also break the weekly trend line which should be the start of an intermediate decline.

    Can you please explain how you resolve this conflict.

  2. With a peak on day 23, this daily cycle is still slated to form in a right translated manner. A break below 21.08 does not change the cycle translation. Therefore a break to new highs would negate the weekly trend line break.

    A trend line break is a signal of an intermediate cycle decline. Confirmation of the intermediate cycle decline arrives with a failed daily cycle.

    • Thank you for this response which, like all your work, is clear.

      I believe that the bullish scenario means a third daily cycle will form. Am I correct in thinking that the norm is for three DCs in each IC? If so, in order to form a failed DC, the DCL of the second DC i.e. somewhere below 21.08 will be broken during the third cycle? Does this imply that the third DC will be LT? And not peak much above the top of DC 2?

      • Canice,

        A timing band of 18 – 24 weeks results in 3 – 4 daily cycles per intermediate cycle.
        A failed daily cycle breaks below the previous daily cycle low. At this point, day 29 may not be the daily cycle low. I the daily cycle extends through today or tomorrow, then it would be the low of that day.

        Now if GDX does not break lower here, but breaks high above the declining trend line that would make day 29 the daily cycle low.

        Here is one of the things that I am watching that makes me keep an open mind to the third daily cycle being a bullish cycle.

        gdx usd

        Often when the dollar declines into an intermediate cycle low, the Miners respond with a rally. The dollar is on the verge of beginning its intermediate cycle decline in earnest.

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