Tuesday 8/25/2015

The daily chart shows price yesterday with another wide range bar down as the markets continued their sharp decline. Price thus far today has opened below its daily pivot but is attempting to correct much of yesterday's decline. Many pundits are saying the bottom was seen yesterday, while just as many are saying the worst is yet to come. Listen to none of them, for none of them know with any more certainty than predicting the flip of a coin. Price can do anything it wants, and it can do it despite the intentions and will of government intervention or in sympathy with them.

What is known is that this decline has happened while price is on the downside of the multi-year, multi-month, and multi-week cycles. The multi-year low could be seen as early as this month (like most recent MY lows), late September/early October (average of MY lows), or even later (extended cycle to adjust for the recent shortened cycles). The multi-month low is projected for the first week of October. Lastly the multi-week low is projected for September 3rd. Given that the longer cycles have influence over the shorter cycles, the bottoming of the MY cycle could easily see the other cycles bottom earlier (or later) than projection. Until there is evidence to the contrary, my expectation is for price to decline into an early September MW low, rebound into a lower MW high, then decline to new lows or a double bottom for the late September/early October MM low.

The hourly chart shows price spiking down on the open yesterday to make its 24Hr low then rallying up to the 24Hr MA where it found resistance for its 24Hr high before selling off into the close. Price overnight found support on the new daily pivot and has traded to retest yesterday's high. It is likely that an early (and higher) 24Hr low was seen either at the cloe or in overnight trading on the daily pivot. This would indicate that price has finally seen a multi-day low. If price is still on the downside of the multi-week cycle, the blue MD MA should provide resistance for the multi-day high. Given the magnitude of the recent decline, however, I would not be surprised to see even a counter-trend multi-day rally exceed the normal areas of resistance. For the same reason, failure to reach the MD MA before finding the MD high would be extremely bearish.