At 25 weeks, stocks are in their timing band for an ICL. Stocks formed a weekly swing high, broke below the weekly trend line and closed below the 10 week MA to signal the intermediate cycle decline.
Stocks should turn the 10 week MA lower in order to complete their intermediate cycle decline. Oftentimes an intermediate cycle decline retraces to the 38 fib level, which coincides with a previous consolidation zone. Stocks are currently in a weekly uptrend. They will remain in their weekly uptrend unless they close below the lower weekly cycle band.
Natgas closed back above the 10 day MA to indicate that Thursday was day 7 of the new daily cycle.Having said that, tonight I wanted to look at the longer term, intermediate cycle.
Natgas printed its lowest point last week, which was week 28. That placed Natgas very deep in its timing band for an intermediate cycle low. Natgas has formed a weekly swing low to signal a new intermediate cycle.A close above the 10 week MA will have us label week 28 was the ICL. Long positions can be entered now that a weekly swing low has formed with stops being placed at the week 28 low of 4.50.
On Thursday we discussed how stocks were rejected by the 50 day MA the previous 2 times that they tested it. And closing above the 50 day MA would be a change of character. Stocks closed above the 50 day MA on Friday
Closing above the 50 day MA on Friday will have us label day 18 as an early DCL. Stocks also closed back above the upper daily cycle band on Friday. Closing back above the upper daily cycle band ends the daily downtrend and begins a new daily uptrend. Closing back above the upper daily cycle band also signals that the ICL has been set.
In The Weekend Report I will further discuss what this means for both the daily cycle and the intermediate cycle — and the yearly cycle. And what expectations we will have based on cycle framework. But let me give you a hint — its bullish.
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The Miners delivered bullish surprise on Friday then closed higher again on Monday.
Friday’s bullish surprise saw the Miners close above the 50 day MA and the upper daily cycle band. Closing above the upper daily cycle band ends the daily downtrend and begins a daily uptrend. Closing above the upper daily cycle band also indicates that the ICL has been set. The Miners are now stretched above the 10 day MA. They will likely need to consolidate above the 50 day MA in order to let the 10 day MA catch up to price.
The Miners broke below the week 24 low two weeks ago to extend their intermediate cycle decline. The Miners printed their lowest point last week, which was week 30. That placed the Miners very deep in their timing band for a ICL. The Miners formed a weekly swing low on Monday, signaling that week 30 was the ICL. A close above the 10 week MA will have us label week 30 as the ICL, which gives the Miners a fresh set of downs for an intermediate cycle advance.
When we last looked at Tesla, it was testing the lower stem of the triangle consolidation it has been in for the past 5 months. And when the consolidation resolves, there is usually a strong trending move that follows.
Tesla tested the trend line again on Wednesday — and it held. Tesla went on to form a daily swing low on Thursday. Stocks are currently in their timing band for both a daily cycle low and an intermediate cycle low, which I will cover in the Weekend Report. And stocks printed a bullish reversal on Thursday. So if this consolidation resolves as stocks print their pending DCL and ICL, this could send Tesla on a bullish trending move.
Tesla has been in a triangle consolidation for the past 5 months.
The resolution of these triangles usually result in a trending move. At this point we do not know if it will be a bullish or bearish trending move. What we do know, from the Weekend Report, is that stocks are in their timing band for both a daily cycle low and an intermediate cycle low. So if this consolidation resolves when stocks print their pending DCL and ICL, this could send Tesla on a bullish trending move.
Gold as been in a weekly consolidation which has been obscuring both our daily and weekly cycle counts. No trending move can be sustained until gold breaks out of this weekly consolidation. It appears that the ICL formed on week 23. A break above the declining weekly trend line will have us label week 23 as the ICL. Gold is currently in a weekly uptrend. A close above the weekly trend line will indicate a continuation of its weekly uptrend and signal a weekly cycle band buy signal.
A complete breakdown of gold’s daily, weekly, and yearly cycles can be found in the Weekend Report.
The goal of the Weekend Report is to develop an on-going framework of expectations using cycle analysis.
It discusses Dollar, Stocks, Gold, Miners, Oil, & Bonds in terms of daily, weekly and yearly cycles. And it also includes the Likesmoney Cycle Tracker.
LM Combo Cycle Tracker & Trend Tracker as of 9/08/23
The first number is the time period for the current cycle high.
Tonight I want to step back and look at the big picture — beginning with stocks
This is week 19 for the intermediate cycle. Another 2 to 5 weeks will place stocks in their timing band for an intermediate cycle low. Bearish divergences continue to develop on the weekly chart. A break below 4504.90 will form a weekly swing high. Then a break below the weekly cycle trend line will signal the intermediate cycle decline.
The dollar printed its lowest point last week. That was week 14, which is early to expect the ICL to form. However, we will need to be open to the idea that the dollar is behaving as if this was week 24 — which would place it in its timing band for an ICL. The dollar formed weekly swing low. A close above the 10 week MA will signal the new intermediate cycle.
So the dollar is potentially rallying out of an intermediate cycle low. That along with reaction to the Fed rate decision on Wednesday and Q2 earnings this week could send stocks into an intermediate cycle decline.
Cycle Trading 