Canary in the Coal Mine

August 21, 2012

The dollar is down and gold and silver are breaking out and we are laughing our way to the bank. No worries.

Keep in mind the silver and gold are in days 20 & 21 respectively and both are in the timing band to seek out a low.

Well the dollar broke below the day 13 intra-day low which is necessary in order to print a daily cycle low. With Tuesday being day 23, if a swing low is printed now it holds the likelihood of marking the daily cycle low

Bonds came close to forming a swing low today.

Like the dollar, today also happens to be day 23 for the Bonds daily cycle.
A break above 122.50 forms a swing low.
A swing low also holds the likelihood of printing the daily cycle low.

So both bonds and the dollar are on day 23 and bonds are close to forming a swing low.

Equities look to have printed a key reversal today.

Stocks printed a 4 year high today, and proceeded to reverse and close lower for the day. Once the dollar prints a daily cycle low, that will likely mark the top to the current equity daily cycle.

What we may have witnessed today was stocks sniffing out the dollar potentially finding its bottom.

The Miners also appear to have printed a reversal.

We see that the Miners gapped higher on the open but closed in the lower range of the daily candle.

The Miners are on day 20 of the daily cycle and are in the timing band to seek out a low.

A break below 441.33 forms a swing high which would likely signal that the Miners have begun their descent into their daily cycle low.

Could be some rough riding ahead.

4 responses to “Canary in the Coal Mine”

trondtveten

August 22, 2012

LM, could ut be that the low of 1590 15 August might have been a daily low following the triangle rule?, Because we’ve really got a massive breakout from the ascending triangle, and 1590 was the last lower touch of that triangle support line.

Reply
1. likesmoneystudies
  
  August 22, 2012
  
  Trond,
  
  A case can be made by the apparent break of the trend line drawn off the 1/23 daily cycle low and the 8/2 pivot.
  That would make a day 17 daily cycle, which has happened before, but it is just short of the normal timing band.
  
  My view is that 8/15 set the daily cycle trend line.
  
  My other two concerns
  
  1) A day 17 daily cycle low would mean that the daily cycle peaked on day 3 and it was a left translated daily cycle.
  7/24 was day 1 of the new daily cycle and I believe a new intermediate cycle.
  A new intermediate cycle generally begins with a right translated daily cycle.
  
  2) The dollar’s cycle count aligns better with day 17 not hosting the daily cycle low.
  Wednesday will bring gold’s daily count to day 22. When the dollar prints its low and begins to rally I believe we will see gold peak and seek out its daily cycle low.
  
  Reply
Jennifer

August 22, 2012

LM, Just want to say your information is one of my first daily stops and critical to my decision making. But I stop by early every day, too, because your graphics always make me smile. Thank you so much.
Dixie

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R41

August 22, 2012

Thanks LM, always a great read.

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