Stocks Complete Swing Low

Stocks closed above Friday’s high to complete a swing low. This signals a new daily cycle.

The daily equity cycle printed its lowest point on Friday, day 58, placing stocks deep in their timing band for a daily cycle low. There are bullish divergences developing on the oscillators and the True Strength Indicator has printed a bullish crossover — all of which indicates that day 58 hosted the DCL. Stocks need to break above the declining trend line for confirmation of the new daily cycle.

But not only do I believe that stocks have completed a daily cycle low, the evidence also points to a weekly cycle low has formed as well.

A weekly swing low is required to signal a new intermediate cycle. While stocks would need to rally over 100 points to form a weekly swing low, there are other indicators pointing to a new intermediate cycle. First is the timing band. The intermediate equity cycle printed its lowest point last week, which was week 24. That placed stocks in their timing band for an intermediate cycle low. The weekly TSI is already at a level that has marked other ICL’s and it is beginning to turn. The weekly RSI has been in a bullish pattern and has begun to turn higher, which we have seen at other intermediate cycle lows.

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Stocks Deliver Bearish Signals

Tuesday was day 40 for the daily equity cycle. That places stocks squarely in their timing band to decline into a daily cycle low. Stocks delivered some bearish signals on Tuesday.

One of the bearish signals was a bearish crossover on the True Strength Indicator. Another bearish signal was the red candle that formed a lower low.

The lower low that formed on Tuesday eases the parameters for forming a swing high. A break below 2768.64 will form a daily swing high. Then a break below the accelerated (blue dashed) trend line will indicate that stocks are declining into the daily cycle low. Once stocks begin their daily cycle decline we should see stocks break below the (black) daily cycle trend line in order to complete their daily cycle decline.

Stocks are in a daily uptrend. They will remain in their uptrend unless they close below the lower daily cycle band. Therefore if a swing low forms above the lower daily cycle band that will indicate a continuation of the daily uptrend.

Stocks – Warning Signals Indicate To Proceed With Caution

Stocks closed below the 10 day MA on Friday. Friday was day 30, placing stocks in their timing band for a daily cycle low. And for reasons that we discussed here on Tuesday, I do not think that day 30 was the daily cycle low.

And stocks delivered more signals on Thursday of a pending daily cycle decline.

One of the signals delivered on Thursday was the bearish TSI divergence. Despite stocks closing at all-time highs there is a bearish divergence developing on the True Strength Indicator.

Another signal on Thursday was the alarmingly large SOS number. As we discussed on Tuesday, stocks printed a huge 777 million Selling on Strength on Tuesday. While the S.O.S. is not a precision tool, we have now received a second larger Selling on Strength signal on Thursday. Stocks printed a huge 1093 million Selling on Strength number on Thursday. This is the type of number usually associated with an intermediate cycle decline. So stocks have now delivered repeated SOS signals while in the timing band for a cycle decline. This increases the odds of a cycle decline.

I also believe something more sinister than a daily cycle decline is unfolding, which I plan to discuss in the Weekend Report.

Natural Gas Harmonic Convergence

Natgas confirmed that it began a new daily cycle this week.

Natgas has also formed a weekly swing low this week. Last week was week 20, which places Natgas in its timing band for an intermediate cycle low. The True Strength Indicator has also printed a bullish weekly crossover. You will notice that Weekly Bullish Crossovers at this level have previously marked intermediate cycle lows. So the new daily cycle has good odds of triggering the start of a new intermediate cycle. as well.

However, I suspect that something even bigger than an intermediate cycle low is forming here. And that is something that I will discuss in my Special Report: Natural Gas Harmonic Convergence.

I would like to make this report available here. The Special Report: Natural Gas Harmonic Convergence and a complementary 6 week trial subscription to the Likesmoney Premium Site is available for $15.

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– This 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 GYX, DAX, 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.

For The Special Report: Natural Gas Harmonic Convergence and a complementary 6 week trial subscription offer click here.

The 3/10/17 Weekend Report Preview

The Dollar
$$$

Friday’s break below the daily cycle trend line confirms that the dollar is in a daily cycle decline.

The dollar peaked on day 19, which assures us of a right translated daily cycle formation. The dollar also managed to close above the upper daily cycle band during this daily cycle. That ended the daily downtrend and indicated that February hosted an intermediate cycle low. Friday was day 25 for the dollar’s daily cycle. That places the dollar in its timing band for a daily cycle low. A swing low will signal a new daily cycle. The dollar is in a daily uptrend and will continue in its uptrend until it closes below the lower daily cycle band

Stocks
stocks

The daily cycle peaked on day 40, locking in a right translated daily cycle formation.

Stocks printed their lowest point on Thursday, following the day 40 peak. The swing low on Friday indicates a new daily cycle. A close above the 10 day MA will signal a new daily cycle. 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.

Normally we would like to see break below the daily cycle trend line before looking for a daily cycle low. But this daily cycle is extremely right translated and it did not happen. Setting aside the trend line break there are other signals that help to determine a daily cycle low. Timing band is one of the criteria. Also normally present in a daily cycle decline is the True Strength Indicator delivering a bearish zero line crossover also along with the formation a weekly swing.

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

Bearish Dollar Signals

0

In the Weekend Report we looked at how the dollar’s weekly cycle set-up has us expecting a left translated daily cycle formation. Today I want to point out some bearish dollar signals

1 $$$ Daily

First off I want to point out that the dollar has established a daily downtrend. It will remain in a downtrend until it can close above the upper daily cycle band.

Second, the True Strength Indicator has reached a level that has previously seen the dollar’s cycle roll over.

The next signal looks at the money flow. For this we need to switch to the ETF UUP

2 $$$ daily

There has been a huge bearish money flow as the dollar is in the process of printing a lower high.

3 $$$ daily

The was a similar huge bearish money flow the last time the dollar printed a lower high before its declining into its yearly cycle low.

And the dollar is in its timing band to seek out its yearly cycle low…

Potential Equity Correction Knocking on the Door

knock

Thursday was day 28 for the daily equity cycle. That places stocks just two days shy of entering their timing band for a daily cycle low.
spx

Some bearish signs are beginning to develop. There is a bearish crossover on the True Strength Indicator. Also, a daily swing high formed on Wednesday, Even though stocks closed higher on Thursday, they did not negate the swing high, leaving it in play. A break of the daily cycle trend line will confirm the daily cycle decline.

Just when you thought it was safe to go back in the waters …

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While gold formed a swing low on Tuesday, there was no confirmation of a new daily cycle …

gld swing

Since gold was late in its timing band for a daily cycle low, it looked like an opportunity to “get back into the water” …

gld daily

But then gold broke lower on Wednesday. Wednesday was day 33 for the daily gold cycle. With gold being this late in its daily cycle, it should bottom any day.

gld divergence am

Gold printed its last yearly cycle low on 12/03/15. Gold is in its timing band for another yearly cycle low. Similar to last year there are divergences developing on the True Strength Indicator and the Money Flow Index. Which signals that once the daily cycle low is in it will most likely mark yearly cycle low as well.

Looking at the Dollar

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The dollar formed a swing high on Monday.

1 $$$ swing

Monday was day 11 for the dollar’s daily cycle. The dollar is still 7 days shy of entering its timing band to seek a daily cycle low. However …

2 $$$ long TSI

The True Strength Indicator has already exceed the level that has marked previous cycle highs. And the TSI is beginning to rollover. Now some bearish follow through should end the dollar into a daily cycle decline.

3 $$$ weekly

The intermediate cycle is either on week 29 or week 14. If week 29 is the correct count then once the dollar rolls over it should enter an intermediate cycle decline.

But if the dollar is on week 14, that would place the dollar 4 weeks shy of its timing band for an intermediate cycle low. Currently the daily cycle high printed on day 10. A peak on day 10 does shift the likelihood towards a right translated daily cycle formation. Allowing for 10 – 15 days for the dollar to print a daily cycle low would take the weekly cycle out to weeks 16 or 17. Then one more failed daily cycle would take the weekly cycle count out to weeks 21 – 24, which is right in the timing band for an intermediate cycle low.

Under a week 14 scenario the dollar potentially can trend lower 7 out of the next 9 weeks.

The 11/18/16 Weekend Report Preview

The Dollar
$$$

The dollar continued higher this week, printing a higher high on Friday.

Friday was day 10 for the daily dollar cycle. A new high on day 10 begins to shift the odds towards a right translated daily cycle formation. The dollar is in a daily uptrend. It will remain in its daily uptrend until it closes below the lower daily cycle band.

Stocks
stocks

Stocks continued higher this week, printing a higher high on Friday. Stocks have begun to close above the upper daily cycle band to establish a new daily uptrend

Friday was day 10 for the daily equity cycle. The True Strength Indicator is beginning to roll over. This suggests that stocks may need to cool off and perhaps decline into a half cycle low, which could potentially see stocks back test the declining trend line.

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