Miner Risk/Reward


 

On Monday we discussed that a break below the (red) trend line would send the Miners into a daily cycle decline.

The Miners printed their lowest point on Tuesday, which was day 55, placing them late in their timing band for a daily cycle low. The Miners formed a swing low on Wednesday, off of support from the 50 day MA. The Miners then delivered bullish follow through on Thursday to signal a new daily cycle. A close above the 10 day MA will have us label day 55 as the DCL.

Long positions can be entered with the stop being placed below Tuesday’s low. Until the Miners break above the upper trend line there is a risk of being whipsawed as the Miners continue to work through the multi month consolidation. Waiting on a break above the declining trend line will reduce the risk of being whipsawed at the expense of missing out on part of the potential rally.

Stocks Confirm New Daily Cycle

Stocks dropped 1.77% on Friday to print their lowest point following the day 33 peak.

Friday was day 40, placing stocks late in their timing band for a daily cycle low. Stocks rallied on Monday and then delivered bullish follow through on Tuesday by closing above the declining trend line and the 10 day MA to confirm Friday as the daily cycle low. Stocks had been in a daily uptrend. Forming the swing low above the lower daily cycle band signals that stocks remain in their daily uptrend and triggers a cycle band buy signal.

In the Mid-Week Update I plan to discuss how stocks are in the process of negating their weekly swing high and what that might mean.

Miner Traction

The Miners have been consolidating since the big summer rally.

Since December the Miners have been printing lower highs and higher lows. These triangle consolidations can obscure our daily cycle counts. A break below the (red) daily cycle trend line should send the Miners to seek out their daily cycle low. But a break above the upper (blue) stem should allow for the Miners to start to get some traction.

The 2/01/20 Weekend Report Preview

The Dollar

 
The dollar formed a swing high on Thursday.

The dollar delivered bearish follow through by closing below the 10 day MA, the 200 day MA and the 50 day MA — which confirms the daily cycle decline. Closing below all of those MA’s also signals something more sinister is afoot, which I cover in the Weekend Report. Friday was day 21, placing the dollar in the early part of its timing band for a daily cycle low. A swing low and close back above the 50 day MA would signal the DCL. The dollar is in a daily uptrend. The dollar will continue in its daily uptrend until it closes below the lower daily cycle band.

Stocks

 
Stocks formed a swing low off of the day 36 low. Since 36 days places stocks in their timing band for a daily cycle low, Tuesday’s swing low signaled a new daily cycle.

Stocks failed to close above the 10 day MA to confirm the new daily cycle and then broke lower on Friday, extending the daily cycle decline. Friday was day 40, placing stocks deep in their timing band for a daily cycle low. A swing low accompanied by a break of the declining trend line will confirm the new daily cycle. Still, stocks are in a daily uptrend and will remain so unless they 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

Not Out Of The Woods Yet

Stocks formed a swing low on Tuesday.

Stocks printed their lowest point on Monday, day 36, placing them in their timing band for a daily cycle low. Tuesday’s swing low and close above the upper daily cycle band signals a new daily cycle. And while Stocks did rebound off the 38 fib level and RSI has also turned higher — indicative of an intermediate cycle advance … we are not out of the woods yet. We will need to see a close above the 10 day MA to label day 36 as the DCL.

In the Mid-Week Update I plan to cover whether stocks are out of the woods in regards yet to their weekly cycle.

Correction

Stocks broke lower on Monday.

Monday was day 36 for the daily equity cycle, placing stocks in their timing band for a daily cycle low. The peak on day 33 assures us of a right translated daily cycle formation, giving us the expectation for stocks to print a higher daily cycle low. So if stocks form a daily swing low, it will have good odds of marking the daily cycle low.

Two things that I am paying attention to is the RSI and the TSI. The RSI is oversold. When stocks are in the advancing stage of their intermediate cycle then RSI does not stay oversold for long, as witnessed in early December. So a quick rebound of the RSI will indicate a continuation of the intermediate cycle advance. But the bearish TSI divergence is a concern. If RSI does not recover quickly that will point to stocks beginning their intermediate cycle decline. Which is something that I plan to discuss in the Mid-Week Update.

The 1/25/20 Weekend Report Preview

The Dollar

 
The dollar closed above the 200 day MA on Thursday and delivered bullish follow through on Friday.

Friday was day 16 for the dollar’s daily cycle. The new high on day 16 indicates a right translated daily cycle formation. The dollar also closed above the upper daily cycle band. Closing above the upper daily cycle band ends the daily downtrend and begins a new daily uptrend. It also indicates that the intermediate cycle low has been set.
 

Stocks

 
Stocks printed a new daily cycle high on Wednesday, day 33.

Stocks formed a swing high on Thursday and then closed below the daily cycle trend line on Friday to confirm the daily cycle decline. Friday was day 35 for the daily equity cycle, placing stocks in their timing band for a daily cycle low.

Notice that the previous daily cycle decline only lasted 3 days and the swing low formed above the upper daily cycle band. That is a signal that stocks have begun a melt up that is characterized by brief corrections. So it is likely for the DCL to arrive early next week.

While we will not be able to know how long stocks will continue in this melt up what we do know is that this usually ends in a crash. Stock are in a daily uptrend. Will will use a close below the upper daily cycle band as a signal of a larger correction.

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

Stocks Keep Going …

Stocks have been on a tear since October after the Fed began Repo operations.

Stocks barely gave us a recognizable daily cycle low in early December. Stocks have since continued rallying. Stocks formed a swing high on Wednesday, day 34. That does place stocks in their timing band for a daily cycle decline. There are bearish divergences developing on the oscillators which normally precede a cycle decline. So Thursday’s
swing high could send stocks to seek out their daily cycle low. A close below the 10 day MA would indicate that the daily cycle is in decline. However, if stocks form a swing low and continue higher, then stops could be raised to Thursday’s low of 3301.87.

Miner Uptrend


 

The Miners closed above the upper daily cycle band on Tuesday.

The Miners printed their lowest point on day 41 to place them late in their timing band for a daily cycle low. Then they formed a swing low on and closed above the 10 day MA last week. The Miners delivered bullish follow through by closing above the upper daily cycle band on Tuesday. This indicates that day 41 was the daily cycle low. Also, closing above the upper daily cycle band resumes the daily uptrend. The Miners will remain in their daily uptrend unless they close below the lower daily cycle band.