Sinister Swing High

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We discussed on Saturday how stocks peaked on day 21, formed a swing high and then breached the daily cycle trend line on Friday setting up for a daily cycle decline.

Stocks delivered a clear and convincing trend line break on Tuesday, confirming that the daily cycle is in decline.

spx daily

Tuesday was day 27 for the daily equity cycle, placing stocks 3 days shy of entering its timing band for a daily cycle low. The peak on day 21 shifts the odds toward a right translated daily cycle formation.

However, due to the status of the intermediate cycle I believe that something more sinister is afoot. I believe that the current daily cycle is still at risk of forming as a left translated, failed daily cycle. A break below the previous daily cycle low of 2352.72 forms a failed daily cycle, which will confirm that the intermediate cycle is in decline.

spx weekly buy op

Tuesday’s daily cycle trend line break has caused stocks to form a weekly swing high. At 34 weeks stocks are very late in its weekly cycle and due for an intermediate decline. Stocks are currently sitting right on the weekly trend line. If stocks continue their daily cycle decline they will break below the weekly trend line signaling that the weekly cycle is in decline. And in the Weekend Report I plan to tie this in with the status of the yearly cycle.

The 6/23/17 Weekend Report Preview

The Dollar
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The dollar printed its lowest point the preceding week on Thursday, day 54. The dollar has since formed a swing low and closed consistently above the 10 day MA signaling a new daily cycle.

The dollar still needs to close above the declining trend line to confirm that Friday was day 6 of the new daily cycle. The dollar is in a daily downtrend & will continue until it closes above the upper daily cycle band.

Stocks
stocks

Stocks peaked on Monday, day 21. Stocks formed a swing high on Tuesday then breached the daily cycle trend line on Friday setting up for a daily cycle decline.

Friday was day 25, placing stocks 5 days shy of their timing band for a daily cycle low. A clear and convincing break of the daily cycle trend line is needed to confirm the daily cycle decline. The peak on day 21 shifts the odds toward a right translated daily cycle formation. However, due to the status of the intermediate cycle I believe that the current daily cycle is still at risk of forming as a left translated, failed daily cycle. A break below the previous daily cycle low of 2352.72 forms a failed daily cycle, which confirms that the intermediate cycle is in decline.

The huge Selling on Strength number from Friday supports this possible scenario.

Stocks printed 783 million SOS on Friday. This is the type of SOS number that is associated with an intermediate cycle top.

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

The 6/16/17 Weekend Report preview

The Dollar
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The dollar undercut the day 49 low, extending the daily cycle out to day 54. The dollar formed a daily swing low on Thursday indicating that day 54 hosted the DCL.

54 days places the dollar very deep in its timing band for a daily cycle low. Still, the dollar needs to break above the declining trend line to confirm the new daily cycle. The dollar has been closing below the lower daily cycle band indicating a daily downtrend. The dollar will remain in its daily downtrend until it closes above the upper daily cycle band.

Stocks
stocks

Day 15 remains as the daily cycle high keeping alive the possibility of a left translated daily cycle formation.

Stocks have been consolidating in a narrow range for the past two plus weeks. The bearish divergence developing on the momentum oscillators indicate a bearish resolution to the consolidation. A break below the day 15 low of 2415.70 will form a daily swing high and indicating a left translated cycle formation. Stocks remain in a daily uptrend and will continue in its uptrend unless it closes 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

Dollar Low

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The dollar printed it lowest point on Wednesday following an extended daily cycle decline. Then the dollar formed a swing low on Thursday to signal a new daily cycle.

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Even though the past 7 daily cycles have stretched to over 32 days from trough to trough, Wednesday was day 54 making this a very stretched daily cycle. The dollar formed a clear and convincing daily swing low on Thursday to signal a new daily cycle. The dollar still needs to break above the declining trend line to confirm the new daily cycle. Once the new daily cycle is confirmed, I suspect that the dollar will also leave behind an intermediate and a yearly cycle low, which I plan to cover in the Weekend Report.

As the dollar rallies out of its yearly cycle low that should send gold into its yearly cycle decline.

gld weekly

Gold formed a weekly swing low off the week 21 low. Gold then regained 50 week MA and closed above the upper weekly cycle band on week 3 to indicate that week 21 hosted the ICL. The only thing missing from the week 21 low was a failed daily cycle. Otherwise all indications are the gold is now in its 2nd intermediate cycle for the year. I suspect that the impending dollar rally out of its yearly cycle low will see the dollar form a right translated weekly cycle. That should cause this new intermediate gold cycle to form as a left translated weekly cycle leading into its yearly cycle decline. Which appears to be in progress.

So far this week gold has formed a weekly swing high. If gold manages to close below both the 50 week MA and the 10 week MA that will further indicate that gold has begun its intermediate cycle decline. The peak on week 4 will assure us of a left translated weekly cycle formation. Since a failed weekly cycle is needed to confirm the yearly cycle decline gold will need to break below the previous ICL of 1214.30 to form a failed weekly cycle.

The 6/02/17 Morning Update

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Gold closed lower on Thursday.

gld

The lower close eases the parameters for forming a swing high. A break below 1262.00 forms a swing high. And then a break below the daily cycle trend line confirms that the daily cycle is in decline.

Gold has yet to print a failed daily cycle during this intermediate rally. Since 2 out of the past 4 daily cycles stretched past 40 days it is still possible for gold to form a left translated daily cycle, even with a new high on day 15.

The Miners are being contained by the declining trend line and they have not followed gold higher. This bearish divergence is a signal of an impending intermediate decline for gold. The Miners have already locked in a left translated daily cycle formation.

gdx

Thursday was day 20 for the daily Miner cycle. The Miners need to break below the day 15 low of 22.20 in order to complete their daily cycle decline. And if gold is in the process of forming a failed daily cycle, then the Miners will likely follow. A break below 20.89 will form a failed daily cycle for the Miners.

A rallying dollar will likely send gold into its intermediate cycle decline.

$$$ daily

The dollar printed its lowest point on day 38, following the day 10 peak. That places the dollar deep in its timing band for a daily cycle low. The dollar is also in its timing band for forming an intermediate cycle low. The dollar has already formed a daily swing low and a weekly swing low. A break above the declining trend line will confirm a new daily cycle for the dollar.

The catalyst that could set things in motion is Friday’s jobs report.

Bearish Gold Divergence

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The dollar printed its lowest point last week on Monday, day 38. Which places the dollar in its timing band for a daily cycle low. The dollar formed a swing low and rallied into Friday which makes it look like day 38 hosted the daily cycle low.

Then the dollar closed lower on Monday.

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Even though the dollar closed lower on Monday, it still appears to be rallying out of a daily cycle low. And I think gold’s reaction on Tuesday supports that notion. Lately when the dollar declines, gold has rallied.

gold daily

In The Weekend Report we discussed the conflicting messages from gold.

The evidence that gold is in a new intermediate cycle:
* A new high on day 14 shifts the odds towards a right translated daily cycle formation.
* Gold is establishing a new daily uptrend.
* Week 21 places gold in its timing band for an intermediate cycle low.
* A weekly swing low has formed.
* Gold has broke above the declining weekly trend line.
* Gold has closed above the 50 week MA.

Reasons that prevents us from labeling May 9th as the ICL.
1) Gold has yet to deliver a failed daily cycle.
2) The dollar is beginning to rally into a new daily cycle.
3) A weekly swing low has formed on the dollar.
4) The Miners have been diverging bearishly from gold.

So instead of rallying on a day where the dollar closed lower, gold also closed lower — perhaps sensing the dollar has formed a daily cycle low. A close below 1261.80 will form a swing high on gold. Then a close below the 200 day MA will confirm that gold’s daily cycle is in decline. Since the previous 4 daily cycles for gold stretched between 28 days and 48 days, a peak on day 14 could still result in a left translated cycle formation.

Oil Delivers Bearish Surprise

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Oil rallied for over 2 weeks since emerging from the May 5th low. Earlier this week oil began to close above the upper daily cycle band to signal an end to the daily downtrend and that oil may have left behind an intermediate cycle low.

oil daily 2

Oil was getting stretched above the 10 day MA and was due for a cooling off or consolidation. Instead, oil delivered a surprise move lower on Thursday. Generally surprise moves occur in the direction of the trend and Thursday’s 4.79% drop indicates that oil is still in a bearish trend.

Thursday’s move lower eases the parameters for forming a daily swing high. A break below 48.53 forms a daily swing high. If oil forms a daily swing high then it will also threaten closing below the lower daily cycle band. A close below the lower daily cycle band indicates that the intermediate cycle is in decline. You will notice that the previous 2 times that oil closed below the lower daily cycle band that oil ended up forming failed daily cycles.

Taking a Look at Stocks

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Stocks broke out to a new high on Monday. So let’s take a closer look at both the daily and weekly cycles.

spx

Stocks peaked on day 30. Stocks then formed a swing high and broke clearly below the daily cycle trend line to print its lowest point on Thursday, day 32. That placed stocks in the early part of their timing band for a daily cycle low. Normally a daily cycle decline lasts 7 to 15 days which causes the RSI to become oversold. But with stocks in a daily and weekly uptrend, this may be all the correction we will see for the daily cycle decline. Therefore we will label Monday day 2 for the new daily cycle.

spx weekly

The weekly cycle peaked on week 17 and then printed its lowest point on week 21. That does place stocks in their timing band for an intermediate cycle low. But week 21 lacks 2 key things that normally accompany an intermediate cycle low.

The first thing is that stocks did not print a failed daily cycle as it declined into the week 21 low. The other missing criteria is that the weekly RSI did not get oversold. Normally a decline into an intermediate cycle low sees the weekly RSI become oversold. There is one more troubling thing about labeling week 21 as an ICL and that is the bearish divergences developing on the oscillators. Stocks are at an all time high but the bearish divergences suggests that decline into the ICL still needs to occur. So unless I see compelling evidence develop I will label this week as week 28 for the intermediate equity cycle.

The 5/12/17 Weekend Report Preview

The Dollar
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After peaking on day 10, the dollar printed its lowest point on Tuesday, day 28, placing the dollar in its timing band for a daily cycle low. The dollar formed a daily swing low on Wednesday, closing above the 200 day MA to confirm the new daily cycle.

The dollar is in a daily downtrend and will continue in its daily downtrend until it closes above the upper daily cycle band. Our intermediate cycle count is at 14 weeks, so our expectation is to see another left translated, failed daily cycle before the intermediate cycle low prints. The daily swing high that formed of Friday aligns with that expectation. A close back below the 200 day MA will signal that the dollar is declining into its daily cycle low and continuing its intermediate cycle decline.

Stocks
stocks

Stocks printed their highest point on Tues, day 30. A daily swing high formed on Thursday and stocks closed below the 10 day MA on Friday to confirm that stocks are declining into their daily cycle low.

Friday was day 33 for the daily equity cycle, placing stocks in their timing band for a daily cycle low. Once a daily swing low forms, it has good odds of marking the DCL. Stocks are in a daily uptrend and will remain so until 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

Daily Cycle Decline

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The daily equity cycle peaked on Tuesday, day 30, locking in a right translated daily cycle formation. Stocks went on to form a daily swing high on Thursday to signal the start of its daily cycle decline.

spx

Thursday was day 32 for the daily equity cycle. That places stocks in their timing band for printing a daily cycle low. The swing high that formed on Thursday broke below the daily cycle trend line providing more evidence that stocks are declining into their daily cycle low.

mc

The typical daily cycle decline will last anywhere from 7 to 15 days. A couple of things that we can watch for will be for the RSI to get oversold and that the McClellen oscillator hit the minus 60 to minus 80 range.