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.

Steel is Coiling

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Steel broke above the declining trend line to signal that Monday was day 5 for the new daily cycle. I would like to see a close above the declining 50 day MA to confirm the new daily cycle.

slx daily

Steel printed its lowest point last Tuesday, day 21, which places steel in its timing band for a DCL. If last Tuesday is confirmed as the daily cycle low that will mean that steel printed higher low from the May 18th low. A higher low would indicate that steel has completed the first daily cycle of a new intermediate cycle. We have been unable to confirm a new intermediate cycle because steel has been coiling below the 37.80 level for the past 8 weeks.

slx weekly

Steel appears to have printed a failed intermediate cycle low in May.
Steel printed its lowest point during the second week of May following the week 8 peak. 20 weeks places steel in its timing band for an intermediate cycle low. Steel is also in its timing band for forming a yearly cycle low. Once a new weekly cycle is confirmed it will signal that the new yearly cycle has begun.

Steel has been coiling below the the 37.80 level for the past 8 weeks. A close above the 37.80 level will confirm the new intermediate cycle and signal that steel has begun a new 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

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Also included in the Weekend Report is the Likesmoney CycleTracker

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You can email me at likesmoney@gmail.com to receive a sample copy of the Weekend Report

Oil Delivers a Bullish Signal

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Oil formed an inside day on Thursday. This is a bullish signal of an impending daily cycle low.

oil daily

Oil printed its lowest point on Wednesday, day 32, which places oil in its timing band to form a daily cycle low. An inside day that forms in the timing band for a daily cycle low has good odds of signaling a new daily cycle. At this point oil needs to form a swing low and break above the declining trend line to confirm a new daily cycle. A break above 44.20 forms a daily swing low.

In the Weekend Report I will discuss that once a daily cycle low forms for oil, that it will likely mark the weekly and yearly cycle lows as well.

Dollar Signals New Daily Cycle

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After an extended decline, the dollar formed a swing low on Thursday to signal a new daily cycle.

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The dollar printed its lowest point on Thursday, following the day 10 peak. At 49 days, that places the dollar deep in its timing band for a daily cycle low. The swing low signals a new daily cycle. A break above the declining trend line will confirm the new daily cycle.

Once a the new daily cycle is confirmed, there are bigger implications on the horizon …

$$$ yearly

June is month 13 for the yearly dollar cycle. Since the dollar’s yearly cycle has averaged 9.7 months since the 2008 15 year super cycle low, this places the dollar in its timing band for a yearly cycle low. So once a new daily cycle is confirmed, it will likely mean that the dollar is embarking on a new yearly cycle as well.

Miner Breakout

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The Miners broke convincingly above the declining trend line on Tuesday.

gdx

I received plenty of emails today asking if the Miner’s breakout on Tuesday signals that day 14 hosted an early daily cycle low. The evidence suggest no. The Miner’s first 10 daily cycles since emerging from the bear market bottom back in December, 2015 averaged 23.7 days. The previous 2 daily cycles ran 49 and 39 days respectively. So 14 days historically is just too early for a DCL, so we will label it as a half cycle low. That makes Tuesday day 22 for the daily Miner cycle. A new high on day 22 shifts the odds towards a right translated daily cycle formation.

The second reason for labeling Tuesday as day 22 for the Miners is the status of the daily gold cycle.

gld

Gold is the driver to the precious metals market. Gold only had a mid-cycle consolidation which makes Tuesday clearly day 19. The new high on day 19 shifts the odds towards a right translated cycle formation. Which aligns with where the Miners are in their daily cycle.

sos

The Miners delivered a large Selling on Strength number on Tuesday. Often times these large Selling on Strength numbers appear at or near cycle tops. Which is another reason that supports a day 22 labeling for the Miners.

In Wednesday’s Mid-Week Report I plan to discuss where this places gold and the Miners in their intermediate cycle and tie that in with what the dollar is doing.

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.

The 5/19/17 Weekend Report Preview

The Dollar
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The dollar continued lower this week.

While Friday could be day 8, since 5 of the previous 7 dollar daily cycles stretched 30 days or longer makes it likely that Friday was day 37. That places the dollar deep in its timing band for a daily cycle low. At this point a swing low has good odds of marking the DCL, The dollar is in a daily downtrend and will continue in its downtrend until it closes above the upper daily cycle band.

Stocks
stocks

Stocks formed a swing low on Friday to indicate that Thursday hosted the daily cycle low.

A break of the declining trend line is normally used to confirm the new daily cycle. However the recovery on Thursday and Friday following Wednesday’s steep sell off does not allow for the construction of a declining trend line. Since stocks faded into the close on Friday, I would like to see a close above the upper daily cycle band before labeling Thursday as the daily cycle low.

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

Something’s Not Adding Up

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The dollar broke below the previous daily cycle low on Tuesday. This formed a failed daily cycle and continues the dollar’s intermediate cycle decline.

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Tuesday was day 7 for the dollar’s daily cycle. At 7 days, the dollar is not expected to print a daily cycle low for at least another 2 weeks. But since 2 of the previous 3 daily cycles stretched to 36 plus days, the dollar could trend lower for up to 4 plus more weeks.

The normal expectation if the dollar breaks below a previous low would be to see gold soaring, but so far that has not happened …

gld

Gold printed its lowest point last week on day 41, placing gold deep in its timing band to print a DCL. A swing low has formed and it appears that Tuesday was day 5 for the new daily cycle. The troubling thing is that despite the dollar dropping, gold has struggled to rally out of the day 41 low and has yet to break above the declining trend line to confirm that it is in a new daily cycle.

I think that gravitational pull from gold’s impending intermediate cycle decline is, in part, restraining this rally out of the day 41 low.

gld weekly

Gold printed its lowest point last week, which was week 21. That does place gold in the early part if its timing band for an intermediate cycle low. Since the previous 2 weekly cycles ran 26 and 28 weeks respectively, the weekly gold cycle could easily accommodate one more daily cycle before printing its intermediate cycle low. And since gold has yet to print a failed daily cycle, our expectation is to see this new daily cycle form as a left translated cycle and fail so gold can complete its intermediate cycle decline.

I have to say that the dollar forming a failed daily cycle on day 7 with 2 to 4 weeks before expecting a daily cycle low seems to be at odds with the expectation that the current daily gold cycle forms as a left translated cycle to complete gold’s intermediate cycle decline. My guess is that either the daily cycle count for the dollar is incorrect or gold did print an intermediate low on week 21.

Gold has formed a weekly swing low. If gold breaks above the declining weekly trend line then we will be forced to label week 21 as the ICL. But the other possibility is that the daily cycle count for the dollar may be incorrect.

SSS2

I believe that the dollar regaining the 200 MA and closing back above the lower daily cycle band after printing the day 28 low does signal that day 28 hosted the DCL. But we do need to acknowledge that 5 of the previous 7 dollar daily cycles stretched 30 days or more so Tuesday being day 34 would align with that scenario. So if the dollar prints a DCL over the next few days that be the trigger for gold to complete is intermediate cycle decline.

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.