Monday 2/29/16

Heading into the final trading day of February, the monthly chart shows price having made a lower high and lower low than January, with price trading just above the monthly pivot and last month's close.  With price trading below the yearly pivot and MM and MY MAs (and those MAs flattening or already moving lower), it is obvious that price has been on the downside of the multi-year cycle.  As has been discussed numerous times in this blog, the question remains whether we have been on the downside of a cycle whose peak was in May and are searching for an overdue MY low, or whether we saw a second, early, lower MY high in November and are on the downside of a fresh cycle whose MY low would not be expected until the end of the year.

 

Only price action can let us know the answer to that question.  If price is still searching for an overdue MY, that low should obviously be made soon (and perhaps was seen earlier this month).  Price should then close above its monthly pivot, then trade above the MM and MY MAs and turn those averages upward.   Failure of price to do so would indicate that we are still on the downside of the MY cycle, and the longer we remain on the downside of the MY cycle the more likely it is that we are on a fresh MY cycle and the decline should be expected to continue into year-end.

 

 

The weekly chart shows price last week finding support on the rising MW MA and making a higher low and higher high and close versus the prior week.  Price early in this week's candle has opened above its weekly pivot and has thus far made a higher low and lower high.  Last week's behavior was indicative of price being on the upside of the multi-month cycle.  Similar to the monthly chart, there is a question of whether price is searching for an overdue MM high or whether we had seen an intervening MM cycle (marked with "?") and the MM high is not due until 3/25.  As always, when the MM high has been seen, price will trade below the MW MA and that average will turn lower.

 

The fact that price was able to trade above the monthly pivot and MM MA is a bullish sign, as those higher timeframe reference points should have provided resistance for a MM high if price were on the downside of the multi-year cycle.  While trading above these levels is no guarantee that price is now on the upside of the MY cycle (and it should be noted that price is not above these levels on the important monthly chart), it does give some hope to the bulls in an otherwise bearish chart.  Should price find support at these levels for the next MM low due early May, it would indicate that price is indeed on the upside of the MY cycle.

 

 

 

The daily chart shows price last week making a Wednesday low and Friday high as it continues to ride MD MA support higher.  I believe we are overdue to see the MW high, and price appears to be finding resistance at the 50% retracement level of the decline from the November MM high.  If I am correct, a MW low is projected for the end of this week, and price should decline into this low.  Should price instead continue to work high, I will be more willing to accept the fact that price last week saw a MW high and low made (marked with "?").  This latter scenario would be extremely bullish and lend more credence to the idea that price is now on the upside of the MY cycle.

 

 

 

The hourly chart shows price Friday before the NY open making a 24Hr (and likely MD) high, and falling throughout the day until finding its 24Hr low on MD MA support in Sunday evening trading.  Price has rallied in pre-market trading this morning, but we are overdue to see a 24Hr high.  The daily pivot should provide resistance for this 24Hr high if price is on the downside of the MD cycle, and price should take out the overnight low if price is on the downside of the MW cycle.  Until price breaks Session MA support, however, we must assume that price remains on the upside of the 24Hr cycle.  Decisive trading above the daily pivot would negate the bearish outlook for today, as it would hint that the overnight low was also a MD low.

 

 

Friday 2/26/16

Price yesterday made a higher low, high and close versus Wednesday.  Thus far today price has opened above its daily pivot and eclipsed yesterday's high.   It is obvious that price is on the upside of the multi-week cycle, but the question remains whether it is the same MW cycle that started with the 2/11 MW low or if price is on a new MW cycle that started with Wednesday's low.  While price recovered to close higher that day, the decline had tested the MW MA where price would be expected to find support if price were on the upside of the MM cycle.  Also, while the MD MA did not turn lower- the usual evidence of a MW high having been seen-  there was at least a slight "hitch" in the MD MA before resuming its move upward.

The action this week is unquestionably bullish, regardless of where we are in the MW cycle.  If price is still searching for an overdue MW high, the fact that the high has extended in time and has eclipsed all higher timeframe resistance indicates that price is certainly on the upside of the multi-month cycle and quite possibly the multi-year cycle.  While a MW high would be expected to be seen any day now (and the 1988 area would be a likely level to see this overdue high), all higher timeframe MA and pivots will now be available to act as support for the MW low projected for 3/4.  Alternatively, if this week saw a Monday MW high and Wednesday MW low, it is even more bullish as price would be expected to rise into its next MW high projected for 3/15.

The hourly chart shows price yesterday making a higher Session low late morning and surging higher throughout the day.  While the 24Hr high was not projected until after the close, I expressed bearish concerns that we would perhaps see an early, lower 24Hr high.  These concerns were quickly dashed as price surged out of the higher Session low and moved higher into the close.

It is unclear whether a 24Hr high and low were seen in overnight trading as price flatlined along the Session MA.   If so, it is a sign of bullish strength that price was able to make a 24Hr low so far above the daily pivot and 24Hr MA.   If not, we are overdue for the 24Hr high to be seen and price should be expected to break below Session MA support and test the 24Hr MA or daily pivot for support for the 24Hr low.  

Thursday 2/25/16

Price yesterday made a lower high and lower low but higher close versus Tuesday, closing back above the monthly pivot.  While Monday was certainly a multi-day high and a MD low was seen yesterday, there remains some uncertainty whether Monday was also the MW high. 

 

Should Monday's high hold and price retests the MW MA over the next few days, it will become evident that it was the MW high. Should price eclipse Monday's high this week, however, it would open up two possibilities; either the MW high has yet to be seen (more likely), or Monday was a MW high, yesterday was a MW low, and we are starting on a fresh MW upcycle.   The latter scenario is far less likely but would signal that price is certainly on the upside of the MM cycle and likely the MY cycle.  My expectation is that price will see a steeper decline prior to the projected 3/4 MW low.

 

 

 

The hourly chart shows price yesterday falling sharply into its late morning 24Hr low (and MD low) just above the MW MA.  Price then surged higher for the remainder of the day before finding resistance for its 24Hr high after the close just above the prior 24Hr high.  Price found a higher 24Hr low on MW MA support in overnight trading and has since regained the gold Session MA.  We are currently correcting into a session low, which should find support on the Session MA.

 

A 24Hr high is not projected until after the close.  If price is on the upside of the MW cycle it should easily be able to take out yesterday's 24Hr high (and Monday's MD high).  Failure to do so would indicate that Monday was indeed the MW high and I would expect price to retest and likely take out yesterday's low in the next two weeks.

 

I am particularly wary of the Session MA not providing support on this current test, which would mean that an hour ago we saw a half-shift, lower 24Hr high and would mean yesterday was an early MD high.  This lower MD high would in turn confirm Monday as the MW high.  This is meaningless speculation, however, and we must let price show us whether it will find support and move higher or break support and move lower.

 

 

Wednesday 2/24/16

The daily chart shows price yesterday with an "inside" day and lower close versus Monday with price finding support on the MD MA.  Price today has opened below its daily pivot and is currently trading below the MD MA and weekly pivot.   This behavior indicates that Monday was likely the multi-week high and price will now be falling into its MW low projected for 3/4.  

 It remains to be seen whether the remaining higher timeframe support level, the MW MA, will be able to support price for an early MW low.  While the failure of the MW MA to support price would not necessarily be a death knell for the bulls, a breach of the February lows would be, indicating that price is on the downside of the multi-month and multi-year cycles.   Price finding support at the MW MA for an early MW low would be a very bullish sign and indicate that price is still on the upside of the multi-month cycle.

The hourly chart shows price yesterday making a lower 24Hr high just above the 24Hr MA (confirming Monday as a multi-day high) and then falling sharply into the close.  Price has continued to drop in overnight and pre-market trading.  It is uncertain whether price made an overnight 24Hr low followed quickly by a 24Hr high under MD MA resistance, but I currently lean towards that being the case.  While we did not see a higher Session low that almost always confirms a 24Hr low, we did see a slight price trade above the Session MA and turn that average slightly higher for a few hours.  If we did see an overnight 24Hr low, it sets us up for a very bearish trend day down, as price trades on the downside of the MW, MD, and daily cycles.

Tuesday 2/23/16

My apologies, but there will be no blog entry today, as I am currently involved in trades and cannot afford the time.  Please refer to yesterday's commentary on the daily chart, as nothing has changed significantly.

Monday 2/22/16

The monthly chart shows price thus far in February having made a lower high and lower low than January's candle, but price is currently trading above its monthly pivot and just above last month's close.  Price has obviously been trading on the downside of the multi-year cycle, but if price could close the month above its monthly pivot it would be a sign that perhaps the multi-year low has been seen.  The monthly candle has 6 trading days left, however, and much can happen in that time.   Other than price reclaiming the monthly pivot, nothing in the monthly chart and its implications has changed, so I suggest readers go back and read any of the last few weeks' commentary.

 

The weekly chart shows price last week having made a higher low, high and close versus the prior week.  Price early in this week's candle has opened above its weekly pivot and has made a higher high.   This is behavior indicative of price being on the upside of the multi-month cycle, but until this week closes I will refrain from officially designating last week as the multi-month low.  The reason for this is that should price close down for the week, the setup would look very similar to the December bottom which still stands as a possible MM low.  That bounce also saw price briefly rise above the MM MA, but ultimately finding resistance and closing below it, and it is very possible that the same thing could happen here.

 

I warned on Friday that the risk/reward situation for bulls was very poor, and while price today has taken out Friday's high, that situation has not changed.  If early February saw the overdue MM low, we are still overdue for a MM high to be seen.  The MM MA would be a logical place for price to find resistance for this high, and an intra-bar move above this resistance is fairly insignificant.  Should price be able to close this week above the MM MA and trade even higher next week, the bullish case would be strengthened.

 

 

 

The daily chart shows price last week making a Thursday high at monthly pivot and MM MA resistance and trading slightly lower on Friday as price moved on the downside of the multi-day cycle.  Given that the MW high was projected for tomorrow and that higher timeframe resistance can often see such highs made earlier than projection, I said on Friday that a low risk/high reward short was in order.  I mentioned that such trades are usually losers, and this one proved no different as Thursday's swing high has been taken out in overnight and pre-market trading.  As mentioned above, however, the situation right now is not entirely different than the one in late December in which price also briefly rose above MM MA resistance.  The fact remains that we have seen a lower MW (and MM) low and thus far have not broken above the prior MW high in the timeframe to see a MW high.  Even if price were to break solidly above the MM MA for the next MW high, the odds are very high that price would revisit the MM MA and/or monthly pivot before seeing its next MW low projected for 3/4.

 

 

 

The hourly chart show price on Friday making a lower 24Hr high under daily pivot resistance, classic behavior on the downside of the multi-day cycle.  Price then made its 24Hr low (and MD low) in an area that would become the new weekly pivot; the fact that the weekly pivot at that time was lower is what lead me to believe that price would test the MD MA before finding this MD low.  

 

Price has risen sharply in overnight and pre-market trading and taken out last week's high.  We are slightly overdue to see a 24Hr high, and it is possible that high was seen four bars ago.   If so, price should break Session MA support and trade lower into its 24Hr low projected for noon.  

Friday 2/19/16

Price yesterday made a higher high but slightly lower close versus Wednesday's candle, as price found resistance at the monthly pivot/MM MA confluence.  Price thus far today has opened below its daily pivot and has made a lower low, action indicative of being on the downside of the multi-day cycle.

 

The multi-week high is projected for next Tuesday, but it is very possible that the higher timeframe resistance saw that high made yesterday.  This will not be known for sure until we see how price interacts with the blue MD MA.; if price finds support at the MD MA then price is still on the upside of the MW MA and price will try again to break MD MA/monthly pivot resistance before finding its MW high.   Failure of the MD MA to provide support will indicate that the MW high has been seen.

 

I should stress that while the double-bottom of MW lows and the ability of price to trade well above the weekly pivot and MW MA argues that price has been on the upside of the multi-month cycle, it does not mean that all is well for the bulls.  The MM low was so overdue that it is very possible that yesterday could have been the overdue MM high.  Longs should strongly consider exiting or hedging their positions here, and swing traders could take a low-risk bet on a potentially sharp market decline with a stop above yesterday's high.  Trades with such a high reward:risk ratio are rare (and usually losers), but the potential demands they be taken.

 

 

 

The hourly chart shows price yesterday making its 24Hr high just above the monthly pivot and then falling into its 24Hr low at daily pivot support.  Price then traded sideways overnight before rising to find an early 24Hr high under the resistance of the new daily pivot, behavior indicative of being on the downside of the MD cycle.  A 24Hr low is projected for early afternoon, and I would expect price to test the blue MD MA before that low is seen.   If price is also on the downside of the MW cycle, price should be expected to test the green MW MA in the coming days.

 

 

Thursday 2/18/16

 

Price yesterday made a higher high, higher low and higher close versus Tuesday as price continued on the upside of the multi-week cycle.  Price today has opened above its daily pivot and is trading little-changed from yesterday's close as the monthly pivot and MM MA appear to be providing some resistance.  The MW high is projected for 2/23, but higher timeframe resistance such as this MM MA/monthly pivot confluence could easily see this high put in early, especially if we are on the downside of the multi-year cycle.  If price is able to eclipse this resistance it would be a very bullish hint that price is now on the upside of the MY cycle. 

 

 

 

The hourly chart shows price rising throughout the day yesterday until it found resistance at the monthly pivot.  It is unclear whether the overnight dip down to the 24Hr MA constituted a 24Hr low, as price never made a lower Session high but instead has modestly eclipsed the overnight high.  Should price again rise throughout the day today, it will indicate that we did see an overnight 24Hr high and low.  Given the high potential for the monthly pivot and MM MA to provide resistance for the MW cycle, I am very wary of the potential for it to cause an early 24Hr high and multi-day high.  A break of the daily pivot would indicate that at least a MD high has been seen, with the possibility that the MW high has been seen as well.

 

 

Wednesday 2/17/16

Price yesterday gapped higher and closed near its highs and above the MW MA.  Thus far today, price has opened above its daily pivot and has made a higher high.  The blue MD MA is now moving upward, confirming last Thursday as a multi-week low.  The ability of price to trade above the weekly pivot and the MW MA hints that Thursday was also a multi-month low.  The MW high is projected for 2/23, and the MM MA and/or monthly pivot are the next logical targets for price to find resistance for that high, especially if price is still on the downside of the multi-year cycle.  The ability of price to rally above these higher timeframe resistance areas would give greater hope to the bulls that price may have seen its multi-year low.

 

 

 

The hourly chart shows price yesterday making its 24Hr low just below daily pivot and MW MA support and then rising into its 24Hr high after the NY close.  Price made its 24Hr low in overnight trading on 24Hr MA/daily pivot support and has since taken out yesterday's high, behavior indicative of being on the upside of the multi-day cycle.

 

It is unclear whether yesterday's 24Hr low was also a MD low.  It was mentioned yesterday that the 24Hr low (or the subsequent one) would likely be the MD low, but while it was a lower 24Hr low there was no confirming lower 24Hr high.  I also had mentioned the possibility (that I considered unlikely) that price would find support for its MD low on the MW MA, and I am leaning toward that being the case.  If so, it is a hint that last week was also a multi-month low, as the MW MA acting as support for price is indicative of being on the upside of the MM cycle. Should price stage a steeper decline down to the MD MA after its next 24Hr high, I would be more likely to believe that yesterday was not the MD low.

 

Currently price is in the timeframe to make a Session low, and the gold Session MA should provide support for this low and allow price to move higher in search of its 24Hr high which is projected for after the close.  Failure of the Session MA to provide support for a session low would be a sign that we have seen an early 24Hr high (in fact, another half-span shift) and likely indicate that today is the MD high and Tuesday's high was not.

 

 

Tuesday 2/16/16

The daily chart shows price yesterday gapping up and closing just above the MW MA.  Price thus far today has made a lower low than yesterday and is currently trading right at the MW MA.

 

With a MW low having been seen Thursday and a MW high not due until next Tuesday, price should find support for any pullbacks on the MD MA as it works higher into its MW high.   If price is still on the downside of the multi-month cycle, however, the MW MA would be a standard place for price to find resistance for the MW high, and it could even force that high to be seen early.  If price closes below the MD MA in the next day or two, we will know that price has seen an early MW high and is still on the downside of the MM cycle.   If price is able to trade firmly above the MW MA and turn that average higher, we will know that last week was a MM low as well and it will give hope to bulls that this rally has much further to go.

 

 

 

The hourly chart shows price in yesterday's shortened holiday trading making a 24Hr high just above the MW MA and a shallow 24Hr low just two bars later on MW MA support.  We then saw a half-span 24Hr high in overnight trading which likely signals a multi-day high, and price has since been falling in pre-market trading as it searches for its next 24Hr low.

 

The 24Hr low is projected for just before today's close.  It is likely that the next 24Hr low (or the one after) will also be a MD low.  As mentioned above, if we are still on the upside of the MW cycle, the blue MD MA should provide support for the MD low and price will attempt to take out the recent high in the next week.  Should the green MW MA provide support for the MD low (something I consider fairly unlikely), it would be a very good sign of strength and indicate that last week's low was also a MM low.

 

 

Monday 2/15/16

The monthly chart shows price thus far in February having made a lower high and lower low than the prior month, and with price trading below the monthly and yearly pivots and the MM and MY MAs it is obvious that price is trading on the downside of the multi-year cycle. The question remains whether we are well overdue to see a multi-year low or whether August and November saw an intervening MY low and high and we are now on the downside of a fresh MY cycle whose low is not expected until November of this year.  The upturn of the pink MM MA in December and the fact that price spent the entire month of November above the monthly and yearly pivots and MM and MY MAs argue that price had seen a MY low in August, but the fact that there has been no obvious higher multi-month low since the August low argues against a MY low having been seen.

The weekly chart shows price last week making a lower high, lower low and lower close versus the prior week, with price taking out the low from three weeks earlier indicating price was still on the downside of the multi-month cycle.  A similar question exists on the weekly chart as to whether we are very overdue for a multi-month low or if there was an intervening MM low and high since the August MM low.  The only real candidates for any intervening MM low and high would be the December low and January high, but there was no higher multi-week low after the December low to confirm it as a MM low.  This may be because price ran into MM MA resistance and the strength of the downward momentum of the MY and MM cycles muted the expression of the MW cycle.  If last week proves to be a MM low, it would be more likely that it was an overdue MM low and give some hope that it was also an overdue MY low; if price continues to decline into a mid-March MM low, it would argue that December was indeed an intervening MM low and confirm that we are on the downside of a fresh MY cycle.

The daily chart shows price on Friday opening above its daily pivot and closing above the MD MA.  Price today has again opened above its daily pivot and has taken out last week's high and is testing the MW MA.  This behavior indicates that last Thursday was a multi-week low and price is now on the upside of the MW cycle.  A MW high is projected for next Tuesday.  If price is still on the downside of the MM cycle, price should find resistance at the MW MA; if price is able to trade above the MW MA and turn that average upward over the course of this week it would indicate that last week was also a multi-month low and price is now on the upside of the MM cycle.  As mentioned above, this would give hope that this MM low was also an overdue multi-year low.

The hourly chart shows price making a multi-day low on Thursday, finding support on the daily pivot/24Hr MA for a higher 24Hr low before the open on Friday, and moving relentlessly higher since.  The extension of the 24Hr high, which is well overdue, and the ability of price to trade above MD MA and weekly pivot resistance are indications that Thursday was also a MW low. 

With price currently trading below the gold Session MA, it is likely that the overdue 24Hr high was seen two bars ago and price should now be expected to drop to the 24Hr MA or perhaps even the daily pivot before finding its overdue 24Hr low.

Friday 2/12/16

Price yesterday made a lower high, lower low and lower close versus Wednesday as we continued on the downside of the multi-week cycle.   Price thus far today has opened above its daily pivot and eclipsed yesterday's high. This is behavior indicative of being on the upside of the multi-day cycle, but it remains to be seen whether yesterday's low marked the MW low and price is now on the upside of the MW cycle.  If so, price will be able to trade above MD MA resistance and turn that average higher as price searches for its MW high projected for 2/23.  If we need another MD cycle before the MW low is seen, then price will find resistance here at the MD MA and take out yesterday's low within the next few days.

 

 

The hourly chart shows price falling sharply in pre-market trading yesterday and making its 24Hr low before the NY open.  Price whipsawed violently throughout the day, but was finally able to trade above the 24Hr MA in afterhours trading.  Price found frequent support at the daily pivot in overnight trading, indicating that yesterday was a multi-day low.

 

We are overdue for price to see a 24Hr high- in fact we are in the timeframe for the 24Hr low to be seen.  It is possible that a 24Hr high and low were seen in overnight trading (note the brief downturn in the Session MA), in which case price would be expected to rise throughout the day, but I will work on the assumption that price will make its overdue 24Hr high at MD MA resistance and fall into a late morning 24Hr low before rallying into the close.  Support for this low should be found at the 24Hr MA or daily pivot. Failure to find support at these levels will indicate that price is likely still on the downside of the MW cycle and lower lows would be expected by Monday.

Thursday 2/11/16

The daily chart shows price yesterday making a higher high and higher low but lower close versus Tuesday as price continues on the downside of the multi-week cycle.  The search for the multi-week low, projected for today, has continued in today's trading, with price taking out the January MW low; this indicates that price is also on the downside of the multi-month cycle.

 

Though today is the projected date for the MW low and the projections are frequently accurate, it is vital to remember that the projections are merely a timing guide for when we should expect price to behave in a certain manner; price will do whatever it wants, whenever it wants, however, so we must always let price behavior dictate.  When the MW low is in, price will finally be able to close above the blue MD MA and will turn that average higher as it searches for its next MW high (projected for 2/23).

 

 

 

The hourly chart shows price yesterday making a late morning 24Hr high under MD MA resistance and falling sharply into the close.  The decline continued in overnight trading, as price dropped further to take out the January MW low.  We are overdue to see a 24Hr low, unless the brief foray above the Session MA in overnight trading marked another early 24Hr low and high.  At this point, I will work under the assumption that no overnight low/high was seen, and that the next 24Hr high is due late morning.  Price is currently testing the Session MA again, and if it can close above this average and turn it upward, we can assume that the 24Hr low was seen just one bar ago.

 

We are in the timeframe for price to make a multi-day low, and as mentioned above, we are also in the timeframe for price to see a multi-week low.  While it is possible that we see one more MD cycle before the MW low is in, there is a good chance that the next MD low (occurring either this 24Hr low or the next) will start a much needed rally into the next MW high. 

 

 

Wednesday 2/10/16

Price yesterday made a lower high and higher low versus Monday, closing modestly lower on the day.  Thus far today price has opened above its daily pivot and is trading above yesterday's high, behavior indicative of being on the upside of the multi-day cycle- meaning that Monday was a MD low.  If Monday was also the MW low, then price will rally above the blue MD MA and turn that average upward; if the MW low, projected for tomorrow, has yet to be seen then price will find resistance here at the MD MA and turn lower into its MW low.

The hourly chart shows price yesterday trading mostly sideways, chopping above and below the 24Hr MA and seeing several half-span shifts of the daily cycle.  The higher 24Hr low confirmed the Monday low as a MD low, and the expectation then becomes that price will visit the MD MA before finding its MD high.  Price neared the MD MA last hour (and eclipsed the MD MA on the daily chart), but is currently trading down to the Session MA; it may be that price is merely making a Session low on Session MA support before resuming higher in search of its 24Hr high projected for the close, or price may have made yet another early 24Hr high and will spend the day moving lower.  The ability of the Session MA to provide support on a closing candle basis will let us know which to expect.

We are overdue to see a multi-day high, so it is likely that the next 24Hr high will also be the MD high.   Where price then makes its next MD low will determine whether Monday was merely a MD low or if it was also a MW low.  If it was merely a MD low, price should take out Monday's low in the next couple of days.

Tuesday 2/9/16

Price yesterday made a lower high, lower low and lower close versus Friday as we continue on the downside of the multi-week cycle.  Price today has opened below its daily pivot and is trading below yesterday's close.  The multi-week low is projected for 2/11, and the only question is whether price will take out January's MW low or if we will make a higher MW low and confirm January as a multi-month low.  As always, we will know that the MW low has been seen when price is able to close above the MD MA and turn that average upward.

 

 

 

The hourly chart shows price in yesterday's pre-market trading making a 24Hr high under daily pivot resistance and falling sharply until mid-afternoon when price found its 24Hr low.  It was mentioned in yesterday's blog that with price on the downside of its daily, MD and MW cycles we should expect "a very negative day", which looked like a gross understatement until the last-hour rally pared losses to only, well, very negative. 

 

It appears that price found its 24Hr high several hours ago, again under daily pivot resistance. This is behavior indicative of still being on the downside of the multi-day cycle.  The 24Hr low is projected for an hour before the close.  We are also due to see a MD cycle low.  It is possible that price will make an early, higher 24Hr low today which would confirm yesterday's low as the MD low; if not, the odds become higher that the next 24Hr low will prove to be the MD low. When the low is in, the 24Hr MA and/or daily pivot will cease to provide resistance to price and price will test the MD MA in search of its MD high.

 

 

Monday 2/8/16

The monthly chart shows price thus far in February making a lower high and higher low with price trading below the yearly pivot, monthly pivot and MY and MM MAs.  This is behavior indicative of price being on the downside of the multi-year cycle.  The only uncertainty is whether we are still on the downside of the same MY cycle that saw the May MY high, or did we see a MY low in August followed by an extremely early lower MY high in November.  The first scenario means we are very overdue to see a MY low made, while the second scenario means we will not be due to see another MY low until the year's end.  Neither scenario is bullish, but the latter scenario is far more bearish.

The weekly chart shows price last week making a higher high and higher low but a sharply lower close versus the prior week.  Price early in this week's candle has opened below its daily pivot and the MW MA and has taken out last week's low, behavior indicative of being on the downside of the multi-month cycle.

The uncertainty in the weekly chart is where (or if) the multi-month highs and lows have been seen.  It is possible that we saw a December MM low followed by a weak January MM high, but it is more likely that the late January low was the MM low or that the MM low has yet to be seen; the question in this latter scenario is whether last week saw a weak MM high. There is still a chance that the MM high is still in front of us, or even that the MM low is still in front of us, but we are already overdue to see the MM high; last week's being the MM high fits very well with the projected date of the MM high, and the monthly pivot which provided resistance to last week's high is a likely place for the MM high to be seen when we are on the downside of the multi-year cycle.  This scenario is extremely bearish for stocks, as the next MM low would not be expected until March.

The daily chart shows price last week making a Monday high and Friday low, classic behavior in a downtrend.  Price early in today's candle has opened below its daily pivot and has made a lower high and lower low and is trading below all higher timeframe pivots and MAs.  This is behavior indicative of price being on the downside of the multi-week cycle (and likely MM and MY cycles).  A MW low is projected for Thursday.  Whether price will take out the prior January MW low or will make a higher MW low is obviously uncertain.  A higher MW low would confirm the January low as a MM low, while price taking out this low would obviously indicate that price is still searching for its MM low.  We are extremely overdue to see a MM low, as the last confirmed MM low was in August.  It is possible, as mentioned above, that we have already seen a stealth MM low and MM high since then, but it is not a certainty. 

The hourly chart shows price on Friday making a 24Hr high at MD MA resistance and declining into the NY close.  Price then rebounded in overnight trading to make an early 24Hr high under daily pivot resistance before breaking sharply lower several hours ago.  Price likely saw a Session high last hour and should now trade lower to take out the morning's lows.  A 24Hr low is not projected until after the close; with price also on the downside of the MD cycle, we should expect a very negative day for stocks.

Friday 2/5/16

The daily chart shows price yesterday making a higher high and higher low but slightly lower close versus Wednesday's candle.  Price today has opened below its daily pivot and is currently trading slightly below yesterday's close.  It appears that the MD MA is providing resistance to price; if so, that would indicate that Monday was indeed the multi-week high and that price should fall into its next MW low, projected for 2/11.  Bulls would love to see a sideways move into this low, with the MW MA providing support for price; were this to occur it would indicate that price is on the upside of the multi-month cycle.   If price is instead on the downside of the MM cycle, the MW MA will not act as support and price should take out the January lows before its next MW low is seen.  The next several days hold little upside potential but the possibility of a large downward move should the MW MA support not hold.

 

 

 

The hourly chart shows price yesterday making its 24Hr low on daily pivot support just before the NY open.  Price then surged higher to retest the overnight highs, making an extremely early lower 24Hr high.  This lower 24Hr high confirmed the prior high as a MD high, and since it was a lower MD high than the Monday MD high, it confirmed Monday as a MW high.   Readers of this blog should re-read this paragraph to fully grasp it, as it contains the logical flow of a lower daily cycle high confirming a prior multi-day high, and a lower multi-day high confirming a prior multi-week high.  The same logic applies to higher timeframe charts (and thus higher timeframe cycles), and obviously applies in reverse to cycle lows rather than highs.

It is unclear whether we have seen another 24Hr high made five bars ago; while this would be far earlier than projection, the daily cycle has been making shorter highs and lows the last several days, and the downward bend of the gold Session MA supports the notion that price is now searching for its 24Hr low.  As mentioned above, bulls want to see the MW MA provide support for price as it searches for its MW low.   If it does, we could continue to see early 24Hr highs and lows as price chops sideways into its MW low.  A break of MW MA support should instead lead to a significant move down over the next several trading days.

 

 

Thursday 2/4/16

Price yesterday made a lower high and lower low versus Tuesday but closed higher as price found soft support on the MW MA.   Price today has thus far made a higher high but is currently trading below yesterday's close.

 

It is still unclear whether Monday was a multi-week high or merely a multi-day high.   If it was a MW high, price should continue to find resistance at the MD MA as it trades lower into its MW low projected for 2/11.  If it was merely a MD high, price should eclipse that high within the next couple of days. 

 

 

 

The hourly chart shows price making a 24Hr high at daily pivot resistance just after the NY open.  Price then fell sharply into its 24Hr low just one bar later, as price found soft support on the MW MA.  Price was able to eclipse yesterday's high in overnight trading, indicating that yesterday's low was a MD low.  We have since fallen sharply in pre-market trading as price searches for its 24Hr low which is projected for noon.  If we are on the upside of the MD cycle, price should find support here at the daily pivot; failure to do so would indicate that the overnight high was also an early MD high; this would confirm Monday as a MW high and we should expect price to trade lower for the next week.

 

 

Wednesday 2/3/16

Price yesterday made a lower high, lower low and sharply lower close versus Monday.   Price today has opened below its daily pivot and has made a lower low, testing the MW MA. It is possible that price is merely on the downside of the multi-day cycle; unless price rallies back above the weekly pivot and MD MA today or tomorrow, however, it is likely that price is also on the downside of the multi-week cycle.   If so, one would expect price to move sideways or lower into its next MW low (projected for 2/11).   A sideways or mild move lower into a higher MW low would mean that price is on the upside of the multi-month cycle.   If we are on the downside of the multi-month cycle, price should move sharply lower into a lower MW low than the January MW low.

 

 

The hourly chart shows price yesterday falling throughout the day after Monday's multi-day high.   Price finally found its 24Hr low in afterhours trading on MW MA support.   We are overdue to see a 24Hr high, and it is unclear whether price made that 24Hr high four bars ago under daily pivot resistance or if the high has yet to be seen.  As always, a break of gold Session MA support will indicate that the 24Hr high has been seen. 

 

We are also in the timeframe for the multi-day low to be seen, and it is quite possible that this MD low was seen yesterday on MW MA support.   If so, the 24Hr high may extend in time today before price makes a higher 24Hr low (projected for well after the close).   If price is still on the downside of the MD cycle, price will find resistance at this current level and drop to retest the MW MA.

Tuesday 2/2/16

Price yesterday made a higher low, higher high and slightly higher close versus Friday's candle, closing just above the monthly pivot.  Price thus far today has opened above its daily pivot but is currently trading lower and has taken out yesterday's low.

Today's action is indicative of price being on the downside of the multi-day cycle.  We are also in the timeframe to see a multi-week high, so we must consider the possibility that yesterday was also a MW high.  If so, price would be expected to test the green MW MA before finding its MW low, projected for 2/11.   It is possible that price will see one more MD cycle before making its MW high, in which case price should find support yet again at the blue MD MA before moving higher, perhaps to test the pink MM MA.    How price interacts with the MD MA will tell us which scenario is unfolding.

The hourly chart shows price yesterday making a 24Hr low on daily pivot support and rallying up to its 24Hr high near the close.  Price dropped below daily pivot and 24Hr MA support in overnight trading as it searches for its 24Hr low which is projected for noon.   I would expect price to drop down to the MD MA before the 24Hr low is found.

We are in the timeframe to see a multi-day low, so it will be interesting to see how price rebounds from its next 24Hr low.   If we are still on the upside of the MW cycle, price should find its 24Hr low (and MD low) at the MD MA and then rally above yesterday's high either today or tomorrow.   If we are on the downside of the MW cycle, the MD low may extend in time, meaning we will see a 24Hr low late morning/noon, a 24Hr high below 24Hr MA/daily pivot resistance, and then a lower 24Hr low tomorrow.  Whether price finds support on the MD MA, and how it bounces afterward, will let us know which scenario is unfolding.  

Monday 2/1/16

The monthly chart shows price in January making a lower high, lower low and lower close versus December, closing below the MM and MY MAs and the monthly and yearly pivots.  This is behavior indicative of being on the downside of the multi-year cycle.  Of more importance is whether price is still looking for its overdue MY low from the May MY high, or if price made an early, lower MY high in November and started searching for a new MY low.   If price is still searching for its overdue low, that low would likely be seen within the next few months or could even be behind us if last week's low was a multi-month low that double-bottomed with the August MM low.   If August saw a MY low followed by a premature November MY high, the next MY low would not be expected until year end.

The weekly chart shows price last week having made a higher low, higher high and higher close versus the prior week's candle.  Price early in this week's candle has opened above its weekly pivot and is thus far trading slightly below last week's close.  The behavior of price the last two bars is indicative of price being on the upside of the MM cycle, and indeed the MW MA has started to turn upward; it is important to note, however, that price could easily trade lower this week and erase that upturn of the MW MA by the candle's close.  

Last week was the projected date to see a multi-month high, and it remains unclear whether we are still searching for that MM high or if an early MM high was seen five weeks ago.  Either scenario is bearish, but if the MM low was seen two weeks ago it at least offers hope that the double-bottom of MM lows also marked a MY low, as discussed above.   If a MM high was seen five weeks ago, it is extremely unlikely that two bars ago was anything more than a multi-week low, and price should soon take out the lows in search of a MM low projected for 3/11/16. Under this scenario, the monthly pivot near 1926 would be expected to provide resistance to the rally.

The daily chart shows price last week riding MD MA support on the upside of the MW cycle and closing the week with a Friday high against new monthly pivot resistance.  We are overdue to see a MW high, and the monthly pivot would be a logical place for price to find resistance for this high.  Should we see one more multi-day cycle before finding the MW high, the pink MM MA would be the next logical resistance area.  When the MW high has been seen, price should break MD MA support and turn that average lower as it searches for the MW low projected for 2/11.  Bulls want to see a higher MW low than the 1/20 MW low in order to confirm the 1/20 low as a MM low.  Should we instead see a lower MW low, it would indicate the more bearish scenario discussed in the weekly chart commentary is in play.

The hourly chart shows price on Friday finding support on the 24Hr MA for its 24Hr low before the NY open.   It was mentioned in Friday's blog that price would then be free to stage a significant move up as price would be on the upside of the daily, MD and MW cycles.  Such a rally indeed unfolded, with price eventually finding its 24Hr high just above what would become the new monthly pivot.  Price has since traded lower as it searches for its 24Hr low which is projected for this hour.  If price is still on the upside of the MD cycle, the daily pivot just tested should provide support for the 24Hr low.

We are in the timeframe to see a multi-day high, however, and it is possible that Friday's high was the MD high.  If not, the next 24Hr high (projected for after the close today) would likely be the MD high.  When the MD high is in, price will break daily pivot/24Hr MA support and trade down to at least the weekly pivot and likely the MD MA.  If the MD high is also the MW high, a test of the MW MA near 1883 is likely to be seen by next week.