The 11/07/14 Weekend Report Preview

The Dollar
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The dollar printed a new high on day 17 that all but guarantees that this will result in a right translated cycle.

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Friday was day 17 for the daily dollar cycle. The bearish reversal on Friday gave back nearly all the gains from Thursday. It has also eased the parameters for forming a swing high. A break below 87.54 forms a swing high and then a trend line break confirms the daily cycle decline.

With a right translated cycle virtually assured here then our expectation is that following the anticipated daily cycle decline we should see one more daily cycle for the dollar which should then, fail.

Stocks
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While stocks printed another higher high, the selling on strength continues to add up.

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Our expectation is for the first intermediate cycle that emerges from an intermediate low form as a right translated cycle. The new high on Friday, day 17 begins to shift the likelihood that this cycle will form in a right translated manner.

The previous daily cycle set a new all time high on day 30, before declining into an intermediate cycle low. Stocks printed two 300 plus SOS days, over the past two weeks, as it approached the previous high. But noticed that once stocks closed above the previous high that the SPY printed some huge SOS days. That is the Big Boys handing the bag to the technicians chasing the break out.

There has been over 3.3 billion in Selling on Strength so far. This exceeds the type of selling that I would expect at an intermediate top. Therefor, we will need to consider that this daily cycle may fail. However, I think that it is more likely that we will still see a right translated daily cycle form here, but the next daily cycle will roll over early and fail, leading to an intermediate cycle decline.

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5 responses to “The 11/07/14 Weekend Report Preview”

John Fuller

November 9, 2014

Could it be that the S&P is just entering a half cycle low, and that those large SOS reflect the growing volume of international money from CB’s, hedge funds, pension funds, etc?

As US stocks, the dollar and bonds are so attractive to the rest of the world, what could cause a failed cycle except some really scary news – like a wobbly derivative mountain being shaken by rising interest rates, or the whiff of a major sovereign debt default [France?]?

Presumably, if there are equally large BOWs in a few days that will suggest a continuation of the rising new IC…

1. likesmoneystudies
  
  November 9, 2014
  
  I first thought that we would see a decline into a half cycle low. But with these type is SOS numbers I think something more sinister is afoot.
  
kim2523

November 9, 2014

How far back do your SOS charts go? Do you keep them on a weekly basis too? ❤️ those charts

1. likesmoneystudies
  
  November 10, 2014
  
  Kim,
  
  I do these charts on occasion, but have not kept them in an organized system. I will have to start.
  
  Here is one that I did back in 2013. I was interested in the difference of the SOS numbers preceding an intermediate low verses a daily cycle low.
  LM
  
  posted image
  
  1. kim2523
    
    November 10, 2014
    
    Thx!