Stocks Ready To Cross The Line

Stocks closed at a new all time high on Thursday.

Quite frankly I was a bit surprised to see stocks close above the pervious all time on the first try. Still, stocks are quite stretched above the 10 day MA. They may require some consolidation to allow the 10 day MA to catch up to price.

The decline into the ICL has stretched the ‘elastic band’ lower. This quick recovery is a very good sign. A bullish break higher could trigger a final melt-up phase.

Miner Odds


 

The Miners had been consolidating in a trading box for just over a month. They broke bearishly out of consolidation on Wednesday to form a failed daily cycle. Breaking below the previous DCL should trigger a bloodbath phase to the daily cycle decline that can last 5 to 7 days.  Instead, the Miners delivered a bullish surprise by printing a bullish candle on Thursday.

The Miners formed a swing low on Monday, testing the lower consolidation level. If the Miners are rejected here that should lead to the bloodbath phase. However, at 27 weeks the Miners are very deep in their timing Band for an intermediate cycle low. So if the Miners can close back in the consolidation box then the odds would shift to this not only been a new daily cycle, but a new intermediate cycle as well.

The 11/23 Weekend Report

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Friday was day 27 for the dollar’s daily cycle.

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The dollar is now late in its timing band.
The next swing low should mark the daily cycle low.
A narrow range day on Monday could set up a swing low forming on Tuesday.

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Recall last week how we discussed the 81.50 was a pretty significant level.
The dollar was decisively rejected by it this week.
The dollar formed a weekly swing high and broke the intermediate cycle trend line.
That confirms that the dollar has begun its decline into an intermediate cycle low.

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Last week we saw the dollar testing the declining yearly cycle trend line.
This week we see that the dollar was soundly rejected by the declining yearly cycle trend line.
This reversal lower keeps alive the scenario that the dollar is caught in the grip of a yearly cycle decline.

A break below September’s intra-month low of 78.60 confirms that the dollar is still seeking out its yearly cycle low.

Stocks

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The new daily cycle is certainly behaving like a new intermediate cycle.

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Equities are already up 4.89% off of last Friday’s intra-day low.
Day 4 also saw equities break above the declining daily cycle trend line confirming a new daily cycle.

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This week produced an equity weekly swing low.
Here are very good odds that this is week 1 of the new intermediate equity cycle.
The previous intermediate equity cycle peaked on week 14 and bottomed on week 23, forming a right translated weekly cycle.
Therefore the expectation is for this new equity cycle to print a higher high
Currently we see the weekly cycle is right up against the declining weekly cycle trend line.
A break above the declining trend line confirms a new intermediate cycle.

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The yearly equity cycle stands at month 5.
It appears that a bullish reversal will be left behind.
Since 5 months is too early for a yearly cycle low, we likely witnessed the yearly cycle trend line being set.

This is supported by the fact that the previous weekly cycle printed as right translated, with an expectation of printing the next weekly cycle with a higher high.

A break below this trend line confirms a yearly equity decline.

Gold
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Friday saw gold break through the 1740 resistance level.

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At day 14, gold locked in a right translated daily cycle.
Since there are 4 more days before gold’s timing band for a daily cycle low, gold still has time to make one more push higher, potentially testing the 1800 level.

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Last week saw gold break above the declining weekly cycle trend line.
This week gold formed a weekly swing low confirming that gold is in a new intermediate cycle.

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November is month 6 for gold’s yearly cycle.
We see that gold tagged the yearly cycle trend line and reversed higher.
A break above October’s intra-month high of 1796 confirms that the yearly cycle is still in ascent.

Miners

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Friday was day 4 for the Miner’s daily cycle.

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The Miner’s have already rallied 7.8% form last Friday’s low.

While the Miners have yet to break above the declining cycle trend line to confirm a new daily cycle. Equities are on the verge of confirming a new intermediate cycle and gold has already confirmed new intermediate cycles. The Miners cannot be too far behind.

Last week was week 26 for the Miner’s intermediate cycle, which is getting late in the timing band to print a weekly cycle low.

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The chances are very good that the Miner’s began a new daily cycle this past week.
And at 26 weeks, the chances are also very good that the Miners are also beginning a new intermediate cycle.
A break above 483.57 forms a weekly swing low.
A break above the declining trend line confirms a new intermediate cycle.

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November is month 6 for the yearly Miner cycle.
The Miners tagged the lower stem of the developing triangle consolidation.
A bullish resolution to this monthly consolidation could see the Miners hit 800.

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The CCI

Friday was day 14 for the CCI’s daily cycle.

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Like gold, the CCI is printing a higher high, locking in a right translated nature to the current daily cycle.
There are still 5 more days until the timing band for a low begins.
A swing low for the dollar may herald a top to the current CCI daily cycle.

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There were two important developments to our cycle framework this week with the weekly CCI.

The CCI formed a weekly swing low.
The CCI broke through the declining intermediate cycle trend line.
This confirms a new intermediate cycle for the CCI.

The confirmation of a new intermediate cycle has implications for the dollar’s weekly cycle.

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Notice that the dollar tends to bottom as the CCI peaks.
Conversely the dollar tends to peak as the CCI bottoms.

The CCI confirming a new intermediate cycle adds an extra level of confidence that the dollar has indeed begun seeking out its intermediate cycle low.
That brings an expectation going forward that the dollar’s daily cycles will be left translated, printing lower highs and lower lows.

November is month 5 for the CCI yearly cycle.

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The CCI ran into some major resistance at the 600 level in September.
Now with the confirmation of a new intermediate cycle, we see that the CCI likely set the yearly cycle trend line in November.

And with a fresh set of “legs” that a new intermediate cycle brings, I expect the CCI to break through the 600 resistance level and quite possibly test the all time highs in this new intermediate cycle.

Bonds
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Friday was day 23 for the daily bond cycle.
Bonds are in the timing band to print a daily cycle low.
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Bonds seem to have a little more work ahead of them because they have yet to convincingly break below the daily cycle trend line.

Once there is a trend line break, a daily swing low should mark the daily cycle bottom.

Week 10 formed a weekly swing high for bonds.

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A break below the intermediate cycle trend line confirms the intermediate cycle decline.

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November is month 8 for the yearly bond cycle.
Bonds printed a peak on month 4 and now are caught in a triangle consolidation.
A break below 1120 would confirm that the yearly cycle decline is still in play.

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The 11/09 Weekend Report

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Friday was day 17 for the dollar’s daily cycle.
The dollar flirted with the 150 day ma, but did not penetrate it.
We may still yet see a breach followed by a reversal.

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Day 10 not only set the daily cycle trend line, but also initiated an accelerated trend line (red).
A breach of the 150 MA along with a swing high and a break of the accelerated trend line should mark the top to the this daily cycle.

A day 17 peak on the daily cycle virtually guarantees a right translated daily cycle with the expectation of the next daily cycle printing a higher high.

Considering how equities responded today, the dollar just may have topped today.

This week marked the 8th week of this new intermediate cycle.

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As we will see with the yearly cycle, it appears that the yearly cycle is in decline.
That sets the expectation of subsequent weekly cycles to form as left translated.
Left translated weekly cycles typically peak by week 8.

The dollar should begin its journey into a daily cycle low next week.
A break below 80.28 forms a weekly swing high.
A break below the weekly cycle trend line would confirm an intermediate cycle decline.

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Also in play is is a potential head & shoulders topping pattern that could be syncing up with an intermediate cycle decline.
An extended daily cycle that fails will keep this potential head & shoulders pattern in play.

However, another possibility to be on guard for is for the dollar to print a daily cycle low over the next 3 – 6 days.
That would form a right translated daily cycle setting the expectation of the next daily cycle making one more push to a higher.

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We see that the dollar’s yearly cycle has peaked on month 5 has been in decline since.
November is month 9 on the yearly cycle.

If the dollar breaks above the September intra-month high of 81.67 it will form a monthly swing low.

That would mean that September was a 7 month yearly cycle low.
A 7 month yearly low is a very low probability event.

If the yearly cycle decline is still in play then the dollar should be rejected by the declining yearly cycle trend line.

Stocks
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Friday was day 46 for the daily equity cycle and stocks made a push lower and then turned positive.

A break above 1391.39 will form a swing low.
And with the daily cycle being so late in the timing band, this will likely mark the daily cycle low.

It is interesting to note that one of the market leaders, AAPL, topped the BOW list during the day.

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AAPL then went on to print a reversal on Friday.

Which further suggests a bottom is in.

Oil also appears to have found support rebounding 1.14 % on Friday further supporting the notion a bottom may be in.

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This was week 22 for the intermediate equity cycle.

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It is beginning to get late in the timing band for stocks to print a weekly low.
A daily swing low will not only mark a new daily cycle but a new intermediate cycle as well.

Once the intermediate cycle is printed, equities normally go on at least a 6 week rally, longer if the intermediate cycle forms as right translated.

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The yearly cycle has a current peak on month 3.
A swing high has formed in November, which is month 5 for the yearly cycle.

Since this intermediate cycle appears to be concluding as a right translated cycle,
the expectation is for the next intermediate cycle to print a higher high.
That could see stocks mare a run at the 1500 level.

Gold
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Gold printed its daily cycle low on Monday

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Gold then formed a swing low and broke through the declining cycle trend line
declaring Tuesday as day 1 of the new daily cycle.

Friday was day 4 and we see that gold is taking a breather at the 1740 resistance level.  I suspect that once the dollar rolls over we will see gold slice through 1740 and likely challenge 1800 during this first daily cycle.

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Gold’s intermediate cycle runs 17 – 25 weeks form trough to trough.
This past week was week 25, on the outter timing band to print a weekly low.

This week gold printed a bullish engulfing weekly candle.
Since gold printed a lower weekly low, the earliest gold can form a weekly swing low will be next week.

A break above 1739 forms a weekly swing low and confirms a new intermediate cycle.

Gold is still early in its yearly cycle setting the expectation for this new intermediate cycle to form as right translated, printing a higher high.

We should see gold rally for 12  at least 17 weeks and challenge the all time highs.

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Gold’s yearly cycle formed a swing high, so far, for month 6.

Since it is not likely that the yearly cycle has peaked gold may have set the yealy cycle trend line.

Miners
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It looks as though the Miners daily cycle bottomed on Tuesday.

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A swing low formed on Wednsday making Friday day 3 for the new daily cycle.

Notice how the previous daily cycle was embedded in a bull flag.

I’m believe that when the dollar’s daily cycle rolls over we will see the Miners break out of this bull flag.

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Like gold, this was also week 25 for the Miners intermediate cycle.

The Miners printed a reversal weekly candle.
A break above 493 forms a weekly swing low and a break above 500 should confirm a new intermediate cycle.

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The Miners printed its three year low in May and rallied for42%.
Now the Miners are consolidating that run.

The second half of the yearly cycle should see the miners challenge the all time highs.

The CCI
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Monday also looks to be a daily cycle low for the CCI

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Tuesday, day 1, saw the CCI charged out of the daily cycle low forming a swing low and breaching the accelerated (red) declining  cyce trend line.  

This suggests that new daily cycle.

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This past week was week 23 for the intermediate cycle.
Like gold and the Miners, the CCI is in the timing band to print a low and a reversal candle has been left behind on the weekly chart.

A break above 565 forms a weekly swing low and a break above 570 should confirm a new intermediate cycle.

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The CCI had a 19% run emerging out of it’s three year low.
We see a mini bull flag has formed at month 5 as the CCI is consolidating its run.  
The new daily and intermediate cycle suggest an upside breakout of the bull flag.

Bonds
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The daily bond cycle has not been pretty over the past few months.

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We see that it is currently day 14 as bonds printed a narrow range higher high on Friday.

A break below 125 will form a daily swing high and likely usher in a daily cycle decline.

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This week was week 8 for the intermediate bond cycle.
If the yearly bond cycle is still in decline then we can expect the weekly cycle to peak soon.

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The previous yearly cycle low printed in March.
The yearly cycle peaked at 4 months and now we are currently at month 8

So far the yearly cycle low is September at month  6.

A six month yearly cycle low is too early, so bonds are quite likely be setting the declining cycle trend line.

(Editor’s note — there is a misspelling on the yearly bond chart.  It should say “declining”.)

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The 11/02 Weekend Report

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Friday the dollar did two things of significance from a cycles perspective.

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1st the dollar printed a higher high that negated day 8 as the daily cycle peak.
With a the current peak on day 12, this shifts the odds towards this second daily cycle forming as a right translated cycle.

The second thing of significance the dollar did today was confirm a weekly swing low.

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This is week 7 of the dollar intermediate cycle.
The dollar finally broke above the intra week high of the low printed in September.
That delivers final confirmation of a new intermediate cycle.
This has been very unusual intermediate cycle.
The dollar normally forms a weekly swing low within one to two weeks of the intermediate cycle low.
Prior to this intermediate cycle, the dollar has never needed more than three weeks to form a weekly swing low.

This has been a very weak intermediate cycle.
The last intermediate cycle tacked on over 5 points in 5 weeks time.

The current intermediate cycle has only managed 2 points in 7 weeks time.

The yearly cycle is in decline bringing an expectation of left translated intermediate cycles printing lower lows.
That means that we are looking at either this week or next week as marking the cycle peak.

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The yearly cycle peaked on month 5 and formed a swing high on month 6 and has been in decline.
The yearly cycle typically runs 8 – 15 months from trough to trough suggesting another 1 – 6 months to decline into a yearly cycle low.
A break above the declining yearly cycle trend line would suggest that a (an early) month 7 yearly cycle low printed.

The odds of September hosting an early 7 month yearly cycle low are small.
Only one time since 1978 has the dollar’s yearly cycle run only 7 months.
That happened in 2006 which was in the 5 th and final three year cycle of a 15 year super cycle as the dollar declined into a 15 year low.

Stocks

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Stocks appeared to have printed a 38 day daily cycle low last Friday.

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Stocks formed a swing low on Thursday and Friday could be day 3 of the new daily cycle.

Stocks managed to print a higher daily cycle high on Friday before being rejected by the 50 MA.
A downside break of the mini bear flag forming could see stocks take out the previous dcl of 1396.56
A bearish resolution would mean Friday was day 42.
Stocks still have three more days left in the timing band
so it is possible to see one more push lower which takes out the previous daily cycle low.

Such a move below 1396 would add definite clarity to the cycle counts

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The intermediate cycle sits at either week 21 or week 1.
Last week low was week 20, right in the timing band for a intermediate cycle low.
So far this corrections passes all the criteria necessary for marking an intermediate cycle low sans a failed daily cycle.

Generally speaking, intermediate cycles tend to explode out of the low forming a weekly swing low on week 1.
That did not happen this week further supporting the notions that Friday was day 42.

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October was month 4 for the yearly cycle.
Once a new intermediate cycle is confirmed, it should last 5 or 6 months.
That would bring the yearly cycle to month 9 or 10, in the timing band for the next yearly cycle low.

Gold
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Like equities, gold formed a mini bear flag over the past week.
Of course gold broke to the down side in a panic sell off on Friday.

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Gold either printed a failed daily cycle Friday or the panic sell off was part of an extended daily cycle.

A failed daily cycle means that gold is on day 7 with a potential 3 more weeks of downside.

An extended daily cycle would mean that gold is on day 27.

The fact that equites also are threatening an extended daily cycle supports this view.

I think the key will be the dollar.

If, in fact,the yearly dollar cycle is still in decline, then the dollar will need to roll over soon or
it will break through the declining yearly cycle signaling a new yearly cycle.

If the dollar breaks up through the declining yearly cycle trend line that would shift the odds to Friday being day 7.

Gold’s weekly cycle also points to this being an extended daily cycle.

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Gold’s weekly cycle printed week 24.
Gold’s weekly cycle runs 17 – 25 weeks so gold is still in the timing band to print a low.
I would like to see a small break to the downside that reverses into Friday.
That would ease the parameters for gold to form a weekly swing low the following week.

If Friday was day 7, that would take gold’s weekly cycle out to week 28, which is a low probability event.

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Looking that the monthly picture for gold, this pattern emerges:

The monthly 20 MA has held support for gold except for the 8 year low and now the 4 year low.
Notice that emerging out of the 8 year low, gold back tested the 20 MA before continuing the rally

In fact the set ups are so similar.
Three tests of a significant level followed by the 20 MA backtest.

The Miners
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I would like to start off with last weeks daily chart.

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Last week, the HUi formed a swing low off the day 20 low.
Last Friday held the possibility of being day 2.
What was needed was a break of the declining cycle trend line.

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The Miners delivered a head fake on Wednesday.
The Miners are on day 25 of the daily cycle and should print a low any day (maybe Tuesday)

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Oh those tricky Miners …

The Miners rallied enough to form a weekly swing low …

… sucking in those who jumped in before waiting on confirmation via the declining cycle trend line break.

But stopped short of breaking the weekly declining trend line and then printed a lower low…

… therefore punishing those who jumped in early.

We are still awaiting a weekly swing low and trend line break to confirm a new intermediate cycle.

At 24 weeks, the Miners are getting deep into the timing band for an intermediate cycle low.

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We see the Miners still backtesting the yearly declining cycle trend line.
If this Bull is still alive and kicking, then this trend line should hold.

Keep in mind that the Miners printed a red candle 14 of the 35 months as they rallied out of the 2008 low to the all time high.

The CCI
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Friday was day 27 for the CCI

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The CCI also saw a panic sell off and an is experiencing an extended cycle.

Any day could see a reversal.

And the reversal should print a intermediate cycle low, as well.

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The weekly cycle stands at week 22 and is deep in the timing band for printing a low.

Once a new daily cycle commences, that should also mark the new intermediate cycle.

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Like the Miners we see the CCI back testing the declining yearly cycle trend line.

The 550 level has been a level of support that appears to coincide with the declining trend line.

The CCI will need to reverse off this level to keep the bull alive.

Bonds
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Bonds continue to trade in a range.
Following a left translated daily cycle my expectation is for bonds to break to the downside.

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This was week 7 for the intermediate bond cycle.

Bonds formed a weekly swing low on week 2 and pierced the declining cycle trend line on week 4.

If the yearly cycle is still in decline, then Bonds should break to the downside soon.

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The yearly bond cycle peaked on month 4 and formed a swing high on month 5.
The yearly cycle is in decline.
November marks month 8.
The timing band for a yearly low runs from 9 – 13 months indicating another 1 – 5 months of decline.

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The 10/19 Weekend Report

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A 23 day-daily cycle low printed on Wednesday.
Thursday formed a swing low.

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Friday, day 2, saw a trend line break confirming a new daily cycle.
This was (probably) the first daily cycle of a new intermediate cycle.
Since this first daily cycle was right translated, the expectation is for the new daily cycle to print a higher high.
As we will discuss in a minute, there is an expectation for the dollar to print left translated intermediate cycles, which will translated to left translated daily cycles.
There is fairly good odds the dollar’s daily cycle will peak by day 8.
I expect to see the dollar to confirm an intermediate cycle before peaking.

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The intermediate cycle likely printed its low in September.
That makes this week 5.
The dollar still needs to break above 80.42 to form a swing low and break above the declining trend line to confirm a new intermediate cycle.
Once a new intermediate cycle is confirmed, the dollar will likely run into resistance at the 81 level.
Notice how the dollar broke below the trend line leading from the three year low.
That signals the three year cycle is in decline.
Therefore we can expect that all intermediate cycles should now form as left translated.
Left translated IC’s usually peak by week 8.

My studies show that between 1978 and 2008 there have been 40 left translated intermediate cycles.
During that period 87 % of left translated daily cycles peaked by 8 weeks and 95 % of left translated weekly cycles peaked by week 10.

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The Yearly dollar cycle peaked on month 5.
A swing high formed on month 6 and there has now been more follow though to the downside.
The dollar has entered its primary decline into its yearly cycle low. As the dollar seeks out its yearly low we can expect intermediate cycles to form as failed, left translated cycles where the surprise should come to the downside.

Stocks
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This week equities tried to regain the daily cycle trend line and were soundly rejected.

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The day 8 peak means that this cycle is forming as left translated, which should break below the previous daily cycle low.
Failed left translated daily cycles are the hallmark of an intermediate cycle decline.
The timing band for an equity daily cycle low is 35 to 45 days. Which means we can look for a low to be printed in the next 2 to 12 days.

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The weekly equity cycle stands at week 19.
Last week saw a trend line break and weekly swing high form.
The equity daily cycle should find it low over the next 2 weeks, which will take the weekly cycle to either week 20 or 21 — right in the timing band to print an intermediate cycle low.

The dollar’s intermediate cycle should form as left translated and peak in the next few weeks as well.

Things are lining up for when stocks print its daily cycle low, it will likely also mark the intermediate cycle low.

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The yearly cycle currently has a peak on month 3 and is working on month 4.
With equities seeking out an intermediate cycle low, the October monthly print will likely be seeing more red.

Gold
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Friday was day 17 for gold’s daily cycle and we saw gold begin to accelerate into its intermediate cycle low.

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Monday will bring the start of gold’s timing band to print a daily cycle low.
We will likely see gold continue to sell off as long as the dollar is rallying.

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A cycle peak at week 20 coupled with a failed daily cycle has gold seeking out its intermediate cycle low.
Gold has now broken below the 10 week MA that is characteristic for an intermediate cycle decline.

When gold prints its daily cycle low it will also likely mark the intermediate cycle low. At this point we do not know at swat level gold will bottom. I do think if gold gets in the vicinity of the convergence of the 20 & 50 weekly moving averages that we will have a “Blue Light Special”.

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The gold yearly cycle stands at month 5.

I included the 10 month moving average in this chart.
It is interesting to note that gold held above the 10 month MA besides when gold dipped down into a 4 year cycle low.

The Miners
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The current daily cycle for the Miners peaked on day 3 and has been trending lower since.
The Miners started off this week by breaking below the previous daily cycle low established back on 9/26 producing a failed daily cycle.

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Friday, day 17, saw the Miners make a lower low and appears to have printed a reversal candle.
It is entirely possible that the Miners bottomed on Friday.

Since the 2008 bottom 13 of the 16 left translated daily cycles for Miners have printed a low on or before day 23.
If the Miners break above Wednesday’s intra-day high of 512.11 that would signal that last Friday was a 17 day-daily cycle low.
I would like to see a trend line beak to confirm a new daily cycle.
I think that with the dollar rallying and equities declining that Miners still are at risk for more down side.

However it is worth noticing the relative strength the Miners have compared to gold and remembering that the Miners often lead gold out of a bottom.

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Notice how gold had a marginal break of the previous daily cycle low on Monday and an accelerated follow through on Friday.

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In contrast, the Miners had only a marginal break of the previous daily cycle low on Monday & Friday and Friday closed in the green.

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SIL is holding much better. It did not brake a below the previous daily cycle low.
It appears to be in a triangle consolidation with Friday possibly being the daily cycle low.

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Silver Wheaton also appears to be in a triangle consolidation with Friday also looking like a possible daily cycle low.

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Last week was week 22 for the Miners intermediate cycle.
The Miners have a weekly swing high and trend line break and is now hunting its intermediate cycle low.

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The Miners yearly cycle currently has a peak on month 4 with October being month 5.
October appears to be back-testing the declining trend line.
A reversal higher off the declining trend line would be incredibly bullish for the Miners

The CCI
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The CCI appears to have printed a 13 day-daily cycle low on Monday.

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A swing low formed on Wednesday with Thursday providing a break through the declining cycle trend line.

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The weekly CCI cycle looked to have bottomed on week 17 with a weekly swing low forming the following week.

With a tad more weakness the CCI will break below the week 17 low and then we will label last week as week 20.

Should the CCI break higher, then week 17 will remain labeled weekly cycle low.

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The Yearly cycle has run into stiff resistance from the declining trend line.
When the CCI confirms a new intermediate cycle, that should provide the energy needed to break through the declining trend line.

Bonds
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The dollar bottomed on Wednesday printing day one on Thursday and we see bonds bottoming on Thursday and printing day one on Friday.

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Friday formed a swing low and a trend line break confirming a new daily cycle.

With the dialy bond cycle commencing a new daily cycle, that gives clarity to the weekly cycle.

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The new daily cycle should have TLT break convincingly above the declining cycle trend line to confirm the intermediate cycle.

While bonds are on the verge of confirming a new intermediate cycle, it appears that the new daily cycle really will be short lived.

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TLT peaked on month 4 and has been locked in a yearly cycle decline.
That suggests that intermediate cycles will continue to form as left translated cycles.

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The 10/05 Weekend Report

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The daily dollar cycle has a cycle peak on Monday, day 11.

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On Friday, day 15, the dollar printed a possible reversal candle.
The dollar forms a swing low with a break above 79.46.
If that were to happen along with a break of the declining (black) cycle trend line then we would be forced to consider that the dollar printed an early 15 day daily cycle low.

Why the dollar may have printed an early daily cycle low is because it is still trying to confirm a new intermediate cycle.

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The weekly chart currently has a low printed on week 19.
Three weeks later, we are still awaiting either a break lower or a break higher forming a swing low.
If a daily swing low forms on the daily chart then that keeps the possibility that this is week three of a new intermediate cycle.
A weekly swing low and a break of the (black) declining trend line confirms a new intermediate cycle.

A week 22 scenario prevails if the daily cycle should continue lower.

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October is month 8 for the dollar’s yearly cycle.
The dollar has formed an accelerated (red) declining trend line after peaking on month 5.
The dollar is running into a strong at the 79 support level.
Breaking below the 79 level would likely lead to a failed yearly cycle.

Stocks
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The current daily equity cycle peak stands at day 8.

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Friday was day 23 and equities printed a possible reversal candle.
A swing high followed by a trend line break would signal that the daily cycle is in decline.

If the dollar is in the process of forming a daily cycle low then a correction in stocks could lead to an intermediate cycle correction.

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The past three weeks equities have been consolidating a 14 week run.
The weekly chart shows that stocks are right up against the accelerated (red) trend line.
A break of that trend line would be bearish.
A break of the black weekly cycle trend line confirms an intermediate decline.

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It is undeniable that each round of QE has had a lesser impact.
Equities went from peaking after 12 months to peaking in 10 months to peaking in 6 months.
A back test of the 1400 level would almost be expected. A break below the 1400 level would spell trouble for the yearly equity cycle.

Gold
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Friday was day 7 for the daily gold cycle.

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Friday saw gold tag the rising trend line.
A failure of the rising trend line would signal that the daily cycle and quite possibility the intermediate cycle is in decline.

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The weekly chart shows gold consolidating just below the 1800 level.
The last two times gold tested this level, gold reversed the following week.
A breakthrough of the 1800 level would signal a week 10 scenario.
A rejection by the 1800 level signals a week 20 scenario.

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The monthly chart reflects what we see on the weekly chart.
Gold is testing the 1800 level.
A break above the 1800 level shows little in the way of resistance until the 1900 level.

Miners
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Friday was day 7 for the daily Miner cycle.

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The Miners appear to be in ascending triangle that is coming to a peak.
A break below the rising red trend line would signal a daily cycle decline and possibility an intermediate cycle decline.
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The weekly cycle is similar to gold’s where a break higher indicates week 10.
A break lower indicates week 20.

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The monthly chart shows that the Miners have broke above the declining yearly trend line confirming a new yearly cycle.
October shows the Miners back testing the declining trend line.

The CRB/CCI
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Office memo: the CRB is temporarily off line.

The CCI peaked on Tuesday and has since been held in check by the (red) declining trend line off the 9/17 candle.

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The daily cycle stands at day 7 and could in the process of setting the daily cycle trend line.
A break below the (black) trend line would signal the daily cycle decline.

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The CCI printed a weekly reversal candle on week 16, which is in the timing band for an intermediate cycle low.

The CCI formed a swing low this week.

A break above the declining red trend line would certainly confirm that this was week 1 of a new intermediate cycle.

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October is month 4 for the yearly cycle.
While the CCI did poke through the declining trend line, it is running into significant resistance at the 600 level.

The CCI spent 6 months trying to break through this level before dropping down into its three year low.

Bonds
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Friday was day 15 for the daily bond cycle.

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Bonds have entered the timing band for printing a daily cycle low.
A break above 121.68 forms a swing low.

Bonds intermediate cycle lacks clarity.

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Only twice since 2003 has TLT’s weekly cycle exceeded 24 weeks.
Both times occurred during the yearly cycle decline.
The currently yearly cycle stands at 7 months so it is too early for a yearly cycle low.

That has me thinking that the intermediate cycle low printed on week 21.
Should bonds break above the black declining trend line then that means the intermediate cycle low printed on week 25, making this week – week 3.

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October makes month 7 for the yearly cycle.
The yearly cycle currently hosts a peak on month 4 and a swing high formed on month 5.
The yearly cycle decline looks to be in progress.
90% of TLT yearly cycles prints between 9 & 13 months.

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Gold’s Next Leg Up …

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Thursday was day 14 for the dollar.

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The dollar very likely printed the daily cycle peak on Monday, day 11.
Thursday saw the dollar convincingly breach the daily cycle trend line.
At day 14, the dollar has another 4 days before entering the timing band for a daily cycle low.
The timing band stretches until day 25 so that leaves up to another 11 days for the dollar to find it daily cycle low.

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There has not been a weekly swing low and declining trend line break, which is needed to confirm a new intermediate cycle. Therefore, the current weekly cycle is week 22. If the daily cycle does continues to roll over it will find a low in the next two weeks which could extend the dollar’s intermediate cycle to week 24.

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There has been a lid on gold at the 1780 level for the past 3 weeks.
Gold responded to the dollar breakdown by breaking above consolidation.
Gold should continue to rally as the dollar seeks out its daily cycle low, which could see gold potentially rally until day 17.

A follow up to last night debates has the media reporting that Romney did well in the debates.

Well Ben has a message for Obama …

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