There is an unusual amount of tension across the markets this morning.
Yesterday, the Dollar formed a Daily swing high while testing important resistance. Overnight, the Dollar reversed higher and formed a swing low, negating yesterday’s swing high.
But the larger battle remains.
The Dollar is testing its 200-week moving average. That level may ultimately determine whether yesterday’s reversal was simply premature—or whether the Dollar is preparing to push higher.
Gold is also caught in the tension.
Gold remains deep in its Daily cycle decline. Yesterday produced another potential reversal, but once again price has not provided the follow-through needed to signal the Daily cycle low.
Bitcoin is weakening as well.
Unlike Gold, some weakness in Bitcoin may actually be constructive. Bitcoin has become stretched across multiple timeframes and appears increasingly in need of a Daily cycle reset before attempting another sustained advance.
Stocks present the other side of the picture.
The major indexes remain near their highs. Leadership remains intact, while recent price behavior suggests participation may be beginning to broaden.
None of these markets has resolved the larger question yet.
And today there is an obvious potential catalyst.
The Federal Reserve releases the minutes from its September meeting at 2:00 p.m. ET. Federal Reserve Markets are already showing signs of caution ahead of the release, with the Dollar firmer and Gold and Bitcoin weaker this morning. Reuters
The cycle structures were already in place before the Fed minutes.
The minutes may provide the catalyst.
Price will determine the resolution.
Cycle Alignment
Dollar: Daily reversal challenged as price battles important Weekly resistance.
Gold: Daily cycle decline remains unresolved.
Bitcoin: Daily cycle reset may be developing within a constructive larger structure.
Stocks: Leadership remains intact as participation begins to broaden.
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