Friday 8/21/2015

The market finally chose its direction yesterday, as price traded down sharply and took out the early July low. With this move, price is certainly on the downside of the multi-month and multi-week cycles. Most importantly, there is finally evidence that price is on the downside of the multi-year cycle; more discussion of this will take place in Monday's blog entry.

It was mentioned in yesterday's post that with a MW low not due until early September and a MM low not due until early October, price should fall sharply over the next couple of weeks. The multi-year moving average (MY MA) near the 1986 level or the yearly pivot at 1948 are areas to watch for support for the multi-year low.

The hourly chart shows price falling throughout the day in what was a trend day down. Price finally made its 24Hr low in overnight trading and is currently testing the Session MA for support for a Session low. The 24Hr high is overdue, and while it is possible the high was seen several bars ago, I expect that price will test the 24Hr MA or the daily pivot shortly after the NY open before the 24Hr high is seen. The multi-day low is also overdue, so a rally up to the blue MD MA would be expected by early next week unless the MD cycle gets muted by the strength of the MW and MM cycle downturn.