At week 27, stocks are due to roll over into an intermediate cycle decline. The first step to do so would be to print a failed daily cycle. Therefore our expectation was to see a bearish resolution to the current consolidation.
Instead, today stocks delivered a bullish surprise.
Thursday was day 19 for the daily equity cycle and stocks broke out to a new daily cycle high. A new high today, or later, begins to shift the likelihood that this daily cycle will form as a right translated daily cycle, printing a higher low. If that happens then the earliest we could see a failed daily cycle would be the next daily cycle.
Gold also was bullish today.
Gold printed its lowest point on day 19, following the day 13 daily cycle high. Instead of breaking out in a clear and convincing manner, gold continued to consolidate. The bullish reversal today allowed gold to regain the 50 day MA. A break above the declining (blue) trend line will confirm a new daily cycle.