Jun 27, 2020

Weekly preview

Short term move lower, but I do not know somehow it does not convince me. One or another way it will move lower just not sure about the path. Next week we will know more... which one will be.
Intermediate term - the indices should decline into 20w cycle low, but it is taking too long and I am skeptical that the low will be tested. Probably 50% correction to test support and MA200 weekly.
Long term - the implication for the big picture is bad. It sounds bullish but it is exactly the opposite - in the middle of another B wave.... again, like it or not.

Trading cycle - sell signal. The price is below MA10, RSI is pointing lower below MA18. I am holding my short, it is down until proven otherwise.

Short term - why this decline does not convince me.... there is too much churning around(futures the same), there is no technical damage like breaking support it is just trapped between the three MAs, 8 days later it still has not erased the last move up lasting only 2 days. This supposed third wave of C sucks so far.
To erase the doubts and what RSI is telling(divergences without breaking the trend line at the oversold level) on Monday this third wave should gap lower and waterfall more than 100 points. It should take a few hours not many hours or days.
If we do not see this it is just w(flat)-x-y(zig-zag) for b wave. Or maybe it is b of a triangle who knows. Hanging on this theory because it will be great to see NDX completing this pattern.

Intermediate term - MA50 and MA200 are still holding, but I expect 50% retracement into July for 20w cycle low one or another way. Conveniently the two Fibo retracement levels are at support levels from last year.

Long term - now it looks like the low will not be tested which is very bad news - the main scenario is the bull market is over and we are in another B wave of higher degree compared to 2019.
This is the pattern which makes most sense. Those interested in cycles look at Benner cycles to see how the pattern fits perfect.

Market Breadth Indicators - are in sell mode. Any jump higher should be short living and reversed quickly.
McClellan Oscillator - slightly oversold.
McClellan Summation Index - sell signal.
Weekly Stochastic of the Summation Index - turned lower sell signal.
Bullish Percentage - sell signal.
Percent of Stocks above MA50 - sell signal.
Fear Indicator VIX - another spike expected, just not sure at the moment if there is more to retrace.
Advance-Decline Issues - weak, in the middle of the range.

Short term cycles - we have possible 20d cycle high and now declining into 20d low. If we see move higher this is probably 40d/5w low.
P.S. This green bar the high on 19th of June is wrong data from investing.com in fact it is red bar lower.

Week 14 for the 20w cycle. It seem the decline into 20 week cycle low is running, but still not 100% confirmed price and RSI still has not broke below the MAs.
Most likely March was the important low and I have already changed the chart... I have not seen so short 40w cycle only 24 weeks, maybe because of the speed of the decline. There is no perfect tools cycles are great, but not perfect as every other tool.

Jun 20, 2020

Weekly preview

Four days mess, still waiting for the market to make a decision. From pattern perspective one more high makes more sense.... but even if we see higher high I doubt it will last for a long, just to see divergences and to turn lower. Trading signal and cycles - it makes more sense if we see continuation lower.... but time is playing for the bulls.

Trading cycle - the sell signal has not been negated. The price hanging for several days around MA10, but did not close above it and RSI is still below MA18.

Short term - it is difficult to see completed pattern and reversal. You can try with b(red) triangle, but the futures did not make higher high for c. Maybe some corrective pattern b(green) and we will see a high next week for c.
Even if we see continuation it looks like another zig-zag with long and shallow b wave - most bullish scenario 3/C ED running.
All we can do is wait until we see clear pattern or break below 62% and MA200.

Intermediate term - RSI shows this move up is living on borrowed time - either we have a high and test of the broken trend line or higher high with divergence coming.

Long term - I do not see an impulse higher so changed the alternate scenario from completed wave IV to wave A with a/B completing and b/B until the end of the year. The yellow pattern is adjusted for time with all the 20w/40w/18m cycle lows and highs, it is not just random lines.

Market Breadth Indicators - do not show some strong momentum higher just some ticked up briefly.... rather weakness.
McClellan Oscillator - below zero.
McClellan Summation Index - small double top?
Weekly Stochastic of the Summation Index - still in overbought territory.
Bullish Percentage - turned up from 70 but below the MA and turning lower again.
Percent of Stocks above MA50 - turning lower again, but still above 75.
Fear Indicator VIX - cooling off as expected.
Advance-Decline Issues - is heading lower below zero.

Short term cycles - we have 40d/5w low as expected and 10d cycle high. The question is will we see another high next week for 20d high before continuation lower.

Week 13 for the 20w cycle. I think we have 20w cycle high, but RSI has to confirm it breaking below MA9.

Jun 13, 2020

Weekly preview

The pattern higher has been completed on Monday, the market hanging until FOMC(classics) and reversed - all as it should be.

From the beginning I am following w-x-y which means a-b-c was needed for y - we have it, the move from mid May is zig-zag. I was expecting to see 20w high and decline into 20w low to start - we have it, the last two weeks look like strong rally into important high and reversal.
Short said the price action confirms the analysis so far and there is no need to change it. Now watching for the next steps which should be - completed impulse followed by corrective retracement.

European indices need final low to complete an impulse and retracement, Crude/Brent oil need final low to complete impulse and retracement, USD needs final low to complete 5/c for a-b-c and sharp rally should follow, TLT(bonds) to complete impulse up and retrace. All markets are aligned and ready for a big coordinated drop - just need the confirmation next week.

I moved the trading chart at the first place instead of the most speculative and inaccurate chart - hourly. First it is all about trading so this is the first what you should see and remember. Second I hope those with the comments "wrong again", "you missed it", "EW does not work" will get it finally that trading and analysis is not the same.

Trading cycle - the signal is sell. It is obvious the price closed below the trend line and MA10, RSI confirmed breaking below the trend line and MA18. Any retracement should stay below the purple line. It lasted longer than expected, but we have reversal at day 17 which is rather left translated. Now we should see continuation lower for roughly 20 days. Sudden reversal with new highs will be very strange.
Next week we should see some retracement and testing MA10 - this will be the next entry point like 6-8 days from high to high. On the way down we count from high to high. Retracement should not last more than two days and print bullish weekly candle so we should see a low on Monday, higher until Wednesday and turn lower again. If we see deviation something is wrong.

Short term - it looks like impulse to me, but rather not completed - the "fifth wave" is only three and many indices look rather incomplete. Probably a low on Monday then corrective retracement higher.

Intermediate term - sticking to the analysis until proven wrong - test of the March low with slightly higher or slightly lower low.
With possible impulse completing, expected 40d low and MA50/MA200 support next week should be choppy - low Monday/Tuesday, retracement higher like 2 days and turn lower again.

Long term - expecting this to be the final sell off to complete the whole correction which began in 2018.
Has not paying attention to the bigger pattern for a while now reflecting the option that the bull market could be over.

Market Breadth Indicators - turned lower. With this indicators I would not make bearish bets, but.... I do not know, is this strength or just we have a huge flat correction causing the indicators to swing from extreme oversold to extreme overbought. We are about to find out in the next few weeks.
McClellan Oscillator - turned negative around zero, technically there is small divergence between the two tops.
McClellan Summation Index - turned lower.
Weekly Stochastic of the Summation Index - still in overbought territory.
Bullish Percentage - turned lower, still above 70.
Percent of Stocks above MA50 - turned lower, still above 75.
Fear Indicator VIX - spike higher, cool off for a few days should follow.
Advance-Decline Issues - turned lower, after hitting very overbought level.

Short term cycles - switched to vertical lines for much better visibility. They represent the 20d cycle and sequence of 4 80d or 10w cycle. The theoretical length of the 20d cycle is 14 trading days, but they are running short again. The first one was 12 days, the second one is so far 10 days long. The indices are heading lower into 40d or 5w cycle low early next week. The current pace of the shorter cycles project the low for mid July.
Here is how the high-to-high looks like. Pretty consistent, only in the middle deviating two days. The next 20d high is around 25.06

Week 12 for the 20w cycle. It seems to me we have 20w cycle high so next we should decline into 20w low. RSI still has not confirmed, but the weekly candle looks like reversal candle.
I still think we have not seen the 4y cycle low. We are about to find out in the next few weeks.

Jun 6, 2020

Weekly preview

The pattern was not completed, which was obvious and now we have it with explosion. There is possible completed pattern so waiting for confirmation or not next week. Its taking so long because with very high probability we have 20 week low in March - my mistake. Not that I was not expecting two legs higher and this second leg, the daily cycle showed it clearly, just from the beginning we would had known that it will take longer and higher.

We have two legs higher with shallow and long middle section exactly the same like 2019/2020... some has not learned and counting impulse again.
EW pattern - X wave in 2019, corrective leg lower, corrective leg higher above 62% expect impulse lower to complete flat pattern. I though after X wave from all three corrective patterns flat is the least probable because it is crazy after what happened in March, but it is playing out.
Cycles - 20 week low in March and now final 20 week cycle running with expected low in July to complete at least 4y cycle.

Short term - we can discuss for hours and I have to explain pages and discuss many indexes and futures.... instead lets not distract and keep it simple. IMHO the fact itself that we have to discuss if it is an impulse or not means with very high probability it is not. Impulses are just there and they do not need to be justified.
I see an a-b-c with possible finished c or waves 4-5/c to complete it. I can make the case for both scenarios - again focus on trading, which means patience, which means we wait for the price action on Monday for more information. If I start with trading it will be again long story - I will make it short wait for confirmation.... or some will not understand and call me again full of shit:)

Intermediate term - we discussed before the jump on Friday that it is most likely a flat, now I do not see other pattern fitting. It feels like exhaustion gap... we will see on Monday. Now the time is getting ripe for the gaps to the downside to be closed.

Long term - the leg up almost completed, next final sell off will finish the whole correction which begun in 2018.

Market Breadth Indicators - is strong with some divergences.
McClellan Oscillator - overbought, divergence with the previous high.
McClellan Summation Index - buy signal.
Weekly Stochastic of the Summation Index - buy signal at overbought level for a while.
Bullish Percentage - overbought, divergence with the previous high.
Percent of Stocks above MA50 - strong.
Fear Indicator VIX - made lower low, but still elevated levels. I expect one more rally.
Advance-Decline Issues - overbought.

Daily(trading) cycle - the signal is buy. The price is too far from MA10 next should be this interaction with the moving average.

Hurst cycles day - I guess 20 day low on a pullback or just lower for 40 day cycle low. The lower sine wave probably will need to be adjusted what is coming should have different dynamics from the prior move up.

Week 11 for the 20 week cycle. I have switched to the alternate scenario 20 week low in March. Now the final one is running which should be shorter than the average because the previous one was longer than the average. We had already shorter 10w cycle lasting less than 8 weeks. I guess the length of the 20w cycle should be somewhere between 16-18 weeks. The 20 week cycle high seems to arrive on schedule with the proper price action.