Right Translation

The S&P, the Russell and the Transports are all forming right translated daily cycles. Right translated daily cycles trend higher in a stair step fashion.

All 3 are getting late in their timing bands for a daily cycle low. Both the Russell and the transports have delivered a recognizable correction while the S&P has only formed a swing high. If there has been a change in character, as we discussed here, then we may not see much in the way of a correction for the S&P. However, all three remain in a daily uptrend. So if a swing low forms above the lower daily cycle band the correction strategy is to buy the dip. That is because once an asset is in a daily uptrend, they will remain so until they close below the lower daily cycle band.

Energy stocks have also formed a right translated daily cycle.

XLE peaked on day 27 and has since been slowly working its way into its daily cycle low. A peak on day 27 assures us of a right translated daily cycle formation. XLE printed its lowest point on Thursday, following the day 27 peak. That places XLE deep in its timing band for a DCL. At this point a swing low and close back above the 10 day MA will confirm a new daily cycle. XLE has begun a new daily uptend. It will continue in its uptrend until it closes below the lower daily cycle band.

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The 10/13/17 Weekend Report Preview

The Dollar
$$$

Friday’s bullish reversal at support off the 50 day MA sets up for a daily cycle low to form. 

The dollar printed its lowest point on Friday, day 24.  That places the dollar in its timing band for a daily cycle low. Friday’s bullish reversal off of support from the 50 day MA eases the parameters for forming a daily swing low.  A  break above 93.09 forms a daily swing low.  A close back above the 10 day MA will indicate a new daily cycle. The dollar is in a daily uptrend & will remain so unless it closes below the lower daily cycle band. 

Stocks
stocks

Stocks continued higher printing a new high on Friday, day 37.


 

Stocks are in their timing band for a seeking a DCL.  At this point a swing high and close below the 10 day MA will signal the daily cycle decline.  Stocks continue to close above the upper daily cycle band to indicate a daily uptrend.  Stocks will remain in their uptrend until they close below the lower daily cycle band. 

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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

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Beware Bonds

Bonds finally appear to have confirmed a new daily cycle.

Bonds printed their lowest point last Friday. That was day 12, which is usually too early for a daily cycle low. However bonds have now:
* Broke above the declining trend line
* Delivered a bullish zero line crossover on the TSI
* Closed above the lower daily cycle band
* Closed above the 10 day MA
* Managed to turn the 10 day MA higher.

All of which convinces me that day 12 hosted the DCL.

The bigger picture is that bonds are in their timing band for a yearly cycle low and are in an interemdiate cycle decline.

Bonds have formed a monthly swing high in October. A monthly swing high is required for the yearly cycle decline. Bonds will need to deliver some bearish follow through to confirm that the yearly cycle is in decline.

Bonds are already in a daily downtrend. If the yearly cycle decline has begun then I suspect that we will see bonds backtest the 50 day MA and then rollover into another left translated daily failed cycle in order to complete the yearly cycle decline.

Oil Signals A New Daily Cycle

Oil printed its lowest point on Monday, which was day 25. That is 5 days shy of the normal timing band for a daily cycle low. However, oil is giving every indication that a daily cycle low has formed.

The decline into the day 25 low caused oil to deliver a 50% fib retracement, which we can see at a DCL. Oil then formed a swing low on Tuesday and delivered more bullish follow through on Wednesday causing oil has closed back above the 10 day MA. Oil also has closed above the upper daily cycle band to indicate that it continues in its daily uptrend. Oil will remain in its daily uptrend unless it closes below the lower daily cycle band.

Equity Timing Band

Tuesday was day 33 for the daily equity cycle. That places stocks in their timing band to seek out a daily cycle low.

Stocks printed their daily cycle high last Thursday, day 31, which assures us of a right translated daily cycle formation. But stocks have since closed lower for 2 straight days, which eases the parameters for forming a daily swing high. A break below 2450.02 forms a swing high. Then a break below the daily cycle trend line will confirm that stocks are in a daily cycle decline.

Stocks continue to close above the upper daily cycle band indicating that they are in a daily uptrend. As long as stocks form a swing low above the lower daily cycle band, then stocks will remain in their daily uptrend. And under that scenario, the dip should be bought.

The transports have already confirmed their daily cycle decline.

Tuesday was day 31 for the transports daily cycle. That places them in their timing band to seek out a daily cycle low. The transports have already formed a swing high and broke below the daily cycle trend line to confirm that they have entered their daily cycle decline. The transports have also been in a daily uptrend. They will remain so unless they close below the lower daily cycle band.

The 10/06/17 Weekend Report Preview

The Dollar
$$$

The dollar printed a bearish reversal on Friday, setting up a potential move down into a daily cycle low.

Friday was day 20 for the dollar’s daily cycle, placing the dollar in its timing band for seeking a daily cycle low. A swing high and a break below the daily cycle trend line will confirm the daily cycle decline. A break below 93.60 will form a daily swing high. The dollar continues to close above the upper daily cycle band, indicating a daily uptrend. The dollar will remain in its daily uptrend until it closes below the lower daily cycle band.

trend line

Stocks
stocks

Thursday’s new high on day 31 locks in a right translated daily cycle formation.

Friday was day 32 for the daily equity cycle, placing stocks in their timing band for seeking out a daily cycle low. A swing high and trend line break will confirm the daily cycle decline. A break below 2540.02 would form a daily swing high. Stocks continue to close above the upper daily cycle band, indicating a daily uptrend. Stocks will remain in its daily uptrend until 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.

A Miner Low

0 miner surprise

The Miners formed a daily swing low on Tuesday.

Tuesday’s swing low formed off of the day 59 low, which places the Miner very deep in their timing band for a daily cycle low. Therefore Tuesday’s swing low has good odds of being the day 1 of the new daily cycle.

There are other indicators that signal Tuesday was day one of the new daily cycle. First off the Miners formed a swing low off of support for the 200 day MA. Another signal is that the Miners closed above the lower daily cycle band. There is also bullish divergences developing on the daily oscillators that we see at cycle lows. Now we need to see a close above the declining 10 day MA to confirm Monday as the daily cycle low.

Assuming that the Miners confirm the new daily cycle, what is happening with the dollar will likely cause headwinds for the Miners.

The dollar has formed a monthly swing low off the month 16 low. That places the dollar deep in its timing band for a yearly cycle low. So the monthly swing low has a good chance of marking the yearly cycle low, meaning that the dollar is beginning a new yearly cycle. And the dollar emerging into a new yearly cycle will likely have a deflationary effect on the Miners.

Smoke ’em if you got ’em

The Miners delivered a swing low on Monday

The Miners printed their lowest point on Thursday, which was day 52. The Miners came close to printing a swing low on Friday, but no cigar. The Miners only had 1 daily cycle longer than 52 days over the past 2 years, which occurred in March at 53 days.

So Monday’s swing low has very good odds of marking the daily cycle low. A close above the 10 day Ma will confirm the new daily cycle.

On Sunday I discussed my reservations of the Miners for this new daily cycle. Having stated that I now want make some observations:

1) A swing low deep in the timing band for a daily cycle low is a buy signal.
2) Since the Miners are in a weekly uptrend, there exists the possibility of a bullish surprise.

Miner Change in Expectation

0 miner surprise

On Monday we discussed hunting for a Miner buying signal. Since then the Miners have continued lower and have changed our expectations.

The peak on day 42 locks in a right translated daily cycle formation. But since then the Miners have delivered some bearish signals. First off the Miners closed below the lower daily cycle band. A close below the lower daily cycle band indicates and end to the daily uptrend and the start of the intermediate cycle decline.

The Miners delivered a second bearish signal on Thursday by closing below the 50 day MA. With the Miners being very deep in their timing band for a daily cycle low the rising 50 day MA should have provided support for a daily cycle low to form.

There are also bearish signals developing on the weekly chart.

The Miners have formed a weekly swing high and has broke below the weekly trend line to signal that the intermediate decline has started. Therefore once the daily cycle low forms we will be watching for the new daily cycle to form as a left translated failed daily cycle.

The odds of a left translated daily cycle formation for the Miners will certainly increase if the dollar confirms a new intermediate cycle.

Week 31 remains as the lowest point, placing the dollar late in its timing band to form an ICL. The dollar has confirmed that it began a new daily cycle. So a weekly swing low and a break above the declining 10 week MA will confirm the new intermediate cycle. A break above 92.69 will form a weekly swing low. And if the dollar confirms a new intermediate cycle that should send the Miners to seek out their intermediate cycle low.

Bonds Beginning to Become Bearish

The daily bond cycle peaked on day 29. A swing high formed two days later. Then bonds broke below the daily cycle trend line on day 32 to confirm the daily cycle decline.

Bonds formed a swing low last Thursday off the day 33 candle. Since 33 days places bonds deep in their timing band for a daily cycle low that swing low had good odds of marking the daily cycle low.

However, bonds broke lower.

Bonds delivered a bearish signal last week when they failed to follow through on a swing low deep in the timing band for a daily cycle low. Bonds delivered another bearish signal on Tuesday by closing below the lower daily cycle band. That ends the daily uptrend and indicates that bonds have begun their intermediate cycle decline.

Looking at the weekly chart we can see that bonds formed a weekly swing high last week. Bonds are delivering bearish follow through this week. Bonds also broke below the weekly trend line which is another signal that the intermediate cycle decline has begun.

A failed daily cycle normally ushers in the intermediate cycle low. Since the current daily cycle peaked on day 29, that locks in a right translated daily cycle formation. Bonds should begin a new daily cycle any day. Bonds will need for the new daily cycle to form as a left translated, failed daily cycle in order to complete the intermediate bond decline.