Wednesday 1/20/16

Once again the MD MA provided soft resistance to price as we continue on the downside of the multi-month and multi-week cycles.  We are extremely overdue for the MW low to be seen, but it was mentioned last week that once a high or low becomes extremely overdue there is nothing to say that it can't become even more overdue.  The most usual extreme is the inversion, where (in this case) price keeps dropping into the projected date of its MW high (Friday).

The extreme overdue nature of the MW low is coupled with one of two possible scenarios.

We are either also extremely overdue to see a MM low, or we are early in the start of a new MM cycle downswing.  The first scenario is bearish in that extensions of both the MW and MM lows would be hard to occur unless we are also on the downside of the multi-year cycle.  The latter scenario is even more bearish as it would not only point to us being on the downside of the MY cycle but on the downside of a fresh MY cycle, with August having indeed been a MY low but November having seen an early, lower MY high.   In the former scenario, price could double-bottom with the August low or make a lower low this month or next that would be the overdue MY low.   In the latter scenario, price would not be expected to find its MY low until the end of the year.

The hourly chart shows price yesterday making its 24Hr high just above the MD MA.   I had expected price to find support on the weekly pivot/24Hr MA for its 24Hr low, but instead we saw that yesterday's 24Hr high was also an early MD high, as the relentless search for the MW low continued.   It appears that a 24Hr low was seen several bars ago, as price is currently attempting to turn the Session MA upward.  We are in the timeframe to see a 24Hr high however; if we are still on the downside of the MD cycle then price should find resistance for the 24Hr high at the 24Hr MA or the daily pivot and then resume its decline.