Miner Progress- Update

Last Thursday we looked at the Miners and observed that they formed a daily swing low to signal a new daily cycle.

On Monday the Miners formed a weekly swing low.

The Miners printed their lowest point last week, which was week 28, to place them deep in their timing band for an intermediate cycle low. Forming a weekly swing low signals a new intermediate cycle. A break of the declining weekly trend line will confirm the new intermediate cycle. The Miners are in a weekly uptrend. Since the weekly swing low formed above the lower weekly cycle band — they will remain in their weekly uptrend and trigger a weekly cycle band buy signal. A break above the multi year resistance level indicates a resumption of the bull market.

Miner Progress

When we last discussed the Miners we observed that Tuesday’s bullish reversal could potentially signal the daily cycle low. Tonight we will review their progress.

The Miners followed Tuesday’s bullish reversal by forming a daily swing low on Wednesday. Tuesday was day 20, placing the Miners in the early part of its timing band for a daily cycle low. Wednesday’s swing low signals a new daily cycle. On Thursday the Miners delivered bullish follow through by closing above the 10 day MA. The Miners also delivered a bullish crossover on the True Strength Indicator, which is another signal that Tuesday hosted the DCL. A close above the declining 50 day MA will have us label day 20 as the daily cycle low.

Miner Reversal

The Miners formed a bullish reversal on Tuesday.

Tuesday was day 20 for the daily Miner cycle, placing the Miners in the early part of its timing band for a daily cycle low.

The weekly chart shows that the Miners formed a weekly swing low off of the week 24 low. They followed up by delivering bullish follow through to indicate that week 24 was the intermediate cycle low. However, the Miners were contained by the 10 week MA and then broke below the week 24 low last week, which negated week 24 as the ICL. This week the Miners broke lower still but have now reversed and they are in the process of forming a bullish weekly reversal. This week 28 for the Miner’s intermediate cycle, which is getting late in its timing band for an intermediate cycle low.

So not only does Tuesday’s bullish reversal potentially mark the daily cycle low, it also potentially marks the intermediate cycle low. Since the Miners formed a lower low this week, the earliest a weekly swing low can form will be next week. The Miners are currently in a weekly uptrend. If a weekly swing low forms above the lower weekly cycle band then the Miners will remain in their weekly uptrend and trigger a weekly cycle band buy signal.

Miner Smackdown

The Miners were smacked down on Tuesday.

When the dollar lost the 200 day MA on Friday it looked as if the dollar was heading towards a failed daily cycle. But with the dollar rallying the last 2 days (due to, in my opinion, the currency wars) that caused the Miners to break lower.

The Miners peaked on day 12 and then were rejected by the 50 day MA, forming a swing high. On Tuesday they close convincingly below the 10 day MA and the daily cycle trend line to confirm the daily cycle decline. This also places the Miners at risk of forming a failed daily cycle. A break below 26.18 forms a failed daily cycle.

In the Mid-Week Update I plan to discuss the ramifications to the longer term intermediate cycle if the Miners form a failed daily cycle.

More Miner Action

When we last looked at the weekly chart we saw that the Miners had formed a weekly swing low. This week they have delivered bullish follow through.

The Miners have broken above the declining weekly trend line this week to confirm that this is week 2 of a new intermediate cycle. The Miners are currently in a weekly uptrend. They will remain in their weekly uptrend unless they close below the lower weekly cycle band. A break above the Multi Year Resistance level would indicate a resumption of the Miner bull market.

Miner Update

The Miners printed their lowest point on 10/15. The Miners finally closed above the 10 day MA on Thursday and delivered bullish follow through on Friday to signal that 10/15 was day daily cycle low.

But the Miner got a bit stretched above the 10 day MA and saw some profit taking on Monday and Tuesday, which allowed the 10 day MA to catch up to price. But the Miners closed for a gain on Tuesday. If the Miners deliver bullish flow though and form a swing low off of Tuesday’s candle, that will allow us to construct the daily cycle trend line.

And the Junior Miners also looked bullish on Tuesday.

Like the Miners, the Junior Miners saw some profit taking after tagging the 50 day MA. But where the Miners only closed higher, the Junior Miners printed a bullish engulfing candle signaling that the Juniors are ready to trend higher.

Miner Action – Revisited

Last week when we looked at the Miners it was week 24, which placed the Miners in their timing band for an intermediate cycle low. The Miners formed a bullish weekly reversal last week which eased the parameters for forming a weekly swing low.

This week the Miners formed a weekly swing low.

This week’s weekly swing low signals that last week was the intermediate cycle low. We still need to see the Miners break above the declining weekly trend line for confirmation.

The Miners are currently in a weekly uptrend. Forming a swing low above the lower weekly cycle band means that the Miners remain in their weekly uptrend and also triggers a weekly cycle band buy signal. And a break above the Multi Year Resistance level would indicate a resumption of the Miner bull market.

Miner Action

The Miners have trending lower swing early September and the daily cycle count has become obscured. I have Tuesday as being day 22, which places the Miners in the early part of its timing band for a daily cycle low. A swing low formed on Thursday which signals that Tuesday marked the daily cycle low.

Since the daily cycle count is not clear we will look at the weekly chart.

The weekly chart clearly shows us that the Miners peaked on week 18 then formed a weekly swing high on week 19. The Miners went on to print their lowest point this week, which is week 24. That places the Miners in their timing band for an intermediate cycle low. A weekly swing low accompanied by a break above the declining weekly trend line would have us label week 24 as the ICL. And a break above the Multi Year Resistance level would indicate a resumption of the Miner bull market.

Miner Action

The Miners backtested the 10 day MA on Thursday.

The status of the daily Miner cycle is not clear. The Miners printed a low on September 13th and then printed a lower low on October 1st. So while it is not clear if Day 18 was the DCL or it extended to October 1st, what is clear is if the Miners break above the declining trend line then we will label October 1st as a daily cycle low. In the Weekend Report I plan to discuss the implications now that the Miners have also formed a weekly swing low.

Change of Expectations

Cycle analysis allows us to develop an on-going framework of expectations. Confirmation of our framework of expectations allows us to determine the risk of an asset. When our framework of expectations are not met, then we need to determine why and then possibly change our expectations.

Stocks closed below the 50 day MA on Tuesday and then delivered bearish follow through on Wednesday to set stocks up for a bloodbath phase, which can last 5 to 7 days. It appears that the Fed intervened to on Thursday to prevent the bloodbath phase with stocks printing a bullish reversal on Thursday. This was a change of expectations that has ramifications on the longer term, intermediate cycle. Thursday was day 42, placing stocks late in their timing band for a daily cycle low. Stocks formed a swing low on Friday and closed above the 50 day MA to indicate a new daily cycle.

In my special report, A Change of Expectations, I will discuss this change from our framework of expectations. We will look at both the daily and weekly charts and how this change impacts our framework of expectations going forward.

The Miners were also set up to decline into an intermediate cycle low. Instead, they printed a bullish weekly reversal. So, I also plan to discuss how the Miners did not follow through on expectations this week and will look at how this can play out going forward.

I would like to make this Special Report available here. The Special Report, A Change of Expectations, and a complementary 6 week subscription to the Likesmoney Premium Site is available for $20.

The complementary subscription will give you full access to the premium site. It includes:

1) The Weekend Report, which is posted usually Sunday mornings. It discusses Dollar, Stocks, Gold, Miners, Oil, & Bonds in terms of daily, weekly and yearly cycles – Which includes the Likesmoney Cycle Tracker.

2) The Mid-Week Update. Posted on Wednesday’s is a review of the daily and weekly charts for the above mentioned asset classes.

3)The Weekend Updates take a look of the daily & weekly charts of the Dax, GYX, NATGAS & XLE.

4) Weekly Update of the Bullish Percentile Bingo

5) Frequent (just about daily) updates of my proprietary FAS Buy/Sell Indicator

The goal of the Weekend Report is to develop an on-going framework of expectations using cycle analysis.

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