Thursday 10/1/2015

Yesterday we made a higher low and higher high versus Tuesday's candle, closing above the declining MD MA.   Price thus far today has opened above its daily pivot and made a higher high, testing the weekly pivot from below.  As mentioned yesterday, it seems likely that Monday was a multi-week low.  

The next week will be very important for the bulls, as the multi-week high is not projected until 10/6.   Should price find resistance at the weekly pivot/MW MA area for an early MW high, it would indicate that price is still on the downside of the multi-month cycle and we should expect lower lows to be seen.  Resistance at the higher levels of the monthly pivot and MM MA would suggest that price is on the upside of the MM cycle but still on the downside of the multi-year cycle.   If price can rise above these areas of resistance, it will bolster the idea that the August low was a multi-year low.

In yesterday's hourly chart commentary it was mentioned that a 24Hr high was projected for late morning, but that if price was on the upside of the MW cycle as well as the MD cycle, I expected the 24Hr high to extend in time and allow price to eclipse the MD MA.   It is uncertain at this point whether price indeed made a late morning 24Hr high followed by a 24Hr low two bars later at 24Hr MA support, or if the after-hours/overnight move up to the weekly pivot was part of the same daily cycle.  

We are in the timeframe to expect that a 24Hr high may also be a multi-day high, and the weekly pivot would be a logical place for that MD high to be found.  Normally we would expect price to then break below 24Hr MA and daily pivot support as it searches for its multi-day low. In this case, however, the MD MA lies in between the 24Hr MA and the daily pivot, and if price is on the upside of the MW cycle, price should find support at the MD MA.   It is also possible that price has not yet seen its MD high, and that price will find support right here at the 24Hr MA for its 24Hr low and trade higher throughout the day.

While the bulls are hardly in great shape, having just seen a lower multi-week low, the market is certainly constructive for them in the short term. We are already in the timeframe to expect that the next 24Hr low (or the one after) will also be a multi-day low.  A higher MD low confirms that price is on the upside of the MW cycle.  We would then have until the next MW high (projected for 10/6) for the bulls to show what they've got.