Stocks rallied on Thursday with a rate hike in the rear view mirror.
Stocks regained the 10 day MA on Thursday. Stocks should turn the 10 day MA higher as it rallies out of the recent DCL. Stocks are currently in a daily downtrend. But a close above the upper daily cycle band will end the daily downtrend and begin a new daily uptrend.
Stocks closed above the 10 day MA on Tuesday.
Stocks delivered bullish follow through on Friday confirming day 72 as the DCL. Stocks are now running into resistance at the 50 day MA. The decline into the day 72 DCL caused the 10 day MA to decline sharply, so stocks may need to consolidate to allow the 10 day MA to flatten out before it can turn higher. Stocks are currently in a daily downtrend. They will remain in their daily downtrend unless they close above the upper daily cycle band.
Stocks printed their lowest point on week 25, placing them in their timing band for an ICL. Stocks should turn the 10 week MA lower in order to complete their intermediate cycle decline — but that may not happen. In The Weekend Report I discuss an early signal that indicates the ICL has been set.
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Stocks formed a swing high on Thursday.
Stocks closed above the 10 day MA on Tuesday and then higher again on Wednesday to signal day 72 as the DCL. However, as we discussed here, that the decline into the day 72 DCL caused the 10 day MA to decline sharply. So stocks may need to consolidate to allow the 10 day MA to flatten out before it can turn higher. It appears that stocks are beginning to find their footing on the lower timeframe.
Even through stocks closed lower for the day there is a new pattern of a higher high and higher low emerging on RSI 05. The 2 hour chart showed that stocks ran into resistance at the declining 50 MA and gapped down lower on Thursday. Stocks managed to rally off the daily low to close near the high of the day. Also notice the change in behavior on the 2 hour RSI 05. Prior to Thursday, RSI 05 was characterized by highs below the 70 line and lows below the 30 line. That is beginning to change with a new high above the 70 line and a new low above the 30 line. The next signal that we are watching for is for stocks to close above the 50 MA on the 2 hour chart as further confirmation that day 72 was the DCL.
Stocks closed love the 10 day MA on Tuesday.
Stocks printed their lowest point on Friday, day 72, placing them very deep in their timing band for a DCL. Stocks formed a swing low on Monday, so closing above the 10 day MA signals day 72 as the DCL. The decline into the day 72 DCL did cause the 10 day MA to decline sharply, so stocks may need to consolidate to allow the 10 day MA to flatten out before it can turn higher.
It is still too early to determine day 72 was also the ICL or if more more DCL is needed to complete the intermediate cycle decline. However, stocks did deliver a bullish signal on Tuesday. Stocks closed above the 50 line on RSI 05 on Tuesday. If RSI 05 goes on to embed in overbought that would indicate that stocks are now in the advancing phase of a new intermediate cycle.
Stocks formed a swing low on Monday.
Stocks printed their lowest point on Friday, day 72, placing them very deep in their timing band for a DCL. Monday’s swing low has good odds of marking the DCL. We will use a close above the 10 day MA to label day 72 as the DCL.
We will also need to watch the 50 day MA. A close above the 50 day MA would shift the odds that the ICL has been set. But if stocks are rejected by the 50 day MA, that will indicate a continuation of the intermediate cycle decline
The Dollar
The dollar is in the process consolidating below the 106.25 level.
The dollar did not manage to turn the 10 day MA lower at the day 24 low, so the status of the daily cycle is not clear. The dollar is still stretched above the 10 day MA. A daily cycle decline will help to allow the 10 day MA to catch up to price. The dollar is in a daily uptrend. A bullish break out of consolidation would indicate a continuation of its daily uptrend and signal a cycle band buy signal — in which we would then label day 24 as the DCL.
Stocks
Stocks closed below the 50 day MA on Monday then delivered bearish follow through on into Friday.
Stocks typically print a daily cycle low every 35 to 45 days. So at 72 days, stocks are overdue for a daily cycle low. Stocks broke below the March low and are in the process of seeking out their ICL. Due to the extended daily cycle decline, stocks may not need another daily cycle to complete its ICL. Stocks are currently in a daily downtrend. Stocks will remain in its daily downtrend unless it closes back above the upper daily cycle band.
The entire Weekend Report can be found at Likesmoney Subscription Services
The Weekend Report discusses Dollar, Stocks, Gold, Miners, Oil, & Bonds in terms of daily, weekly and yearly cycles.
Also included in the Weekend Report is the Likesmoney CycleTracker
For subscribers click here.
Bitcoin formed a swing low on Thursday.
Bitcoin printed its lowest point on day 56, placing it deep in its timing band for a DCL. Bitcoin closed above the 10 day MA on Sunday then delivered bullish follow through on Monday. BTC is currently in a daily uptrend. Closing back above the 10 day MA indicates a continuation of its daily uptrend and signals a cycle band buy signal.
The Miners became stretched above the 10 day MA the previous week and have been consolidating above the 200 day MA.
If the face or a rallying dollar the Miners have demonstrated relative strength, holding above the 10 day MA. The Miners currently in a daily uptrend. A bullish break out of consolidation will indicate a continuation of their daily uptrend and signal a cycle band buy signal. A bearish break out of consolidation will signal the daily cycle decline.
Stocks closed below the 10 day MA on Friday.
Friday was day 48, placing stocks deep in their timing band for a DCL. Closing below the 10 day MA signals the daily cycle decline. Stocks should break below the day 44 low of 5091.14 and turn the 10 day MA lower in order to complete its daily cycle decline. Stocks are currently in a daily uptrend. Stocks will remain in their daily uptrend unless they close below the lower daily cycle band.
The decline into the day 26 low did not turn the 10 day MA lower, causing the status of the daily cycle to not be clear.
Stocks broke bullishly out of consolidation on Friday. However, stocks formed a swing high on Tuesday, negating Friday’s breakout. Stocks closed back in the consolidation zone and also below the 10 day MA to signal that Tuesday was day 39 for the daily cycle. That places stocks in their timing band of a DCL. Any bearish follow through will signal the daily cycle decline. Stocks are currently in a daily uptrend. Stocks will remain in their daily uptrend unless they close below the lower daily cycle band.
Cycle Trading 