Cycle Turn Indicator Direction and Swing Summary. of Select Markets as of the close on. March 15, Daily CTI. Swing

Transcription

1 Cycle Turn Indicator Direction and Swing Summary of Select Markets as of the close on March 15, 2019 Market Daily CTI Daily Swing Weekly CTI Weekly Swing Industrial Positive Low Negative High Transports Positive Low Negative High NDX Positive Low Positive Low S&P Inverse Fund Negative N/A * Negative High CRB Index Positive High Positive Low Gold Positive High Negative Low XAU Negative High Positive Low Dollar Negative High Positive Low Bonds Positive Low Negative Low Crude Oil Positive Low Positive Low Unleaded Negative High Positive Low Natural Gas Negative High Negative Low *Since this fund is quoted at the end of the day it is impossible for the concept of swing highs and lows to apply on a daily level. The primary interests here are the weekly developments. The daily is representative of the short-term and the weekly is representative of the intermediate-term Copyright 2019 by Tim Wood 3

2 Short-term Updates Note on the Cycle Turn Indicator The most important indicator we have is the Cycle Turn Indicator and the most important timeframe, at least in my mind, is the intermediate-term. This indicator has proven itself time and time again. In reality, this is all we really need to know. Everything else is secondary. That being said, please be sure to monitor the "Cycle Turn Indicator Direction and Swing Summary" above. Red indicates that a swing high and down turn of the Cycle Turn Indicator has occurred and lower prices should follow. The only exception here is that on the daily stock market signals we also want to see both the slow cycle Turn Indicator and the New High/New Low Differential in agreement with the original Cycle Turn Indicator, which is what is covered in this summary above. Yellow, is cautionary meaning that the Cycle Turn Indicator and the swing are not in agreement, which is typically indicative of a trend change. Green, means that a swing low has occurred and that the Cycle Turn Indicator is positive, which should be followed by higher prices. Again, the only exception here is the daily stock market signals in that we want to see both the slow Cycle Turn Indicator and the New High/New Low Differential in agreement with the original Cycle Turn Indicator, which is what is covered in this summary above. For everything else, all that matters is the formation of a swing and the direction of the Cycle Turn Indicator. All subscribers who do not understand cyclical translation should click here "Notes for New Subscribers." It is important that you read and understand the content found in both of the PDF files that you will find at this link. Copyright 2019 by Tim Wood 4

3 Stocks End of Week Intermediate-Term Indicator Summary Intermediate-Term Sell Primary Indicators Formation of a Weekly Swing High Cycle Turn Indicator (CTI) CTI on Rydex Tempest Fund * Confirming Indicators Trend Indicator (TI) Advance/Decline Issues Diff New High New Low Diff Secondary Indicators Stochastic Cycle Momentum Indicator *When this indictor is it is negative for the market and visa versa. March 17, 2019 Daily Indicator Summary Short-Term Neutral/Sell Primary Indicators Formation of a Daily Swing Low Cycle Turn Indicator (CTI) Slow Cycle Turn Indicator (CTI) New High/New Low Differential Confirming Indicators Trend Indicator (TI) McClellan Intermediate Term Breadth Momentum Oscillator (ITBM) McClellan Intermediate Term Volume Momentum Oscillator (ITVM) McClellan Summation Index McClellan Volume Summation Index Secondary Short Term Indicators Stochastic Cycle Momentum Indicator Trading Cycle Oscillator Momentum Indicator Ratio Adjusted McClellan Oscillator Crossover Accumulation/Distribution Index The advance out of the March 11th half-trading cycle low in Equities remains intact and just as we are seeing short-term overbought readings in association with this advance, a short-term buy signal was finally triggered on the Industrials. Friday s short-term buy signal has occurred in conjunction with a marginal upturn of the slow CTI as we are also approaching the timing band for the next trading cycle low. The previously triggered intermediate-term sell signals also remain intact and the balance of the evidence continues to be suggestive of the intermediate-term cycle top. But, the advance out of the March 11th halftrading cycle low has to run its course. The intermediate-term sell signal on the Industrials and many of the leading indexes, averages and sectors continue to be reflective of the intermediate-term cycle top. Therefore, the assumption continues to be that this top is in the making and ideally the remainder of the advance out of the March 11th half-trading cycle low should conclude this setup. If this advance does in fact prove to be counter-trend, then upon the re-triggering of another short-term sell signal, Equities will be positioned for lower prices in association with the decline into the intermediate-term cycle low. Copyright 2019 by Tim Wood 5

4 Gold completed the formation of a daily swing high on Thursday, but a short-term sell signal was not triggered and with Friday being an inside day, there were no changes. For some reason Thursday s XAU data did not update in my data base and I did not catch it at the time, but the XAU also completed the formation of a daily swing high on Thursday that was confirmed by a downturn of the CTI, which did in fact also triggered a short-term sell signal on the XAU. This also continues to be a technical opportunity for a top in Crude Oil. The short-term sell signal in Gasoline on Friday and the non-confirmation we are seeing on the OSX are suggestive of this being a counter-trend advance, but until a short-term sell signal is triggered and a weekly swing high is formed, we cannot say that a top is in place. The short-term buy signal on the CRB Index remains intact, but it too, should be counter-trend. The short-term sell signal on the Dollar remains intact and there is still a risk of a left-translated intermediate-term cycle top, but in light of the higher degree cycle low, this should be a counter-trend decline with higher prices to follow. Therefore, I can continue to give the Dollar the benefit of the doubt until a left-translated intermediate-term cycle top proves to be at play. The short-term buy signal on the 30-year Bond remains intact and the higher degree intermediate-term cycle low should be in place, but the March 12th daily swing high must be bettered in order to eliminate the risk of a left-translated trading cycle top and thereby the setup for another trading cycle down into the higher degree intermediate-term cycle low. Below is our distribution indicator. The red intermediate-term Advancing issues line is tied to the intermediate-term cycle, which has ticked back down. The green MA line has crossed below the black MA line, which is now another indication of the intermediate-term cycle top. Copyright 2019 by Tim Wood 6

5 The Trading Cycle Oscillator in the upper window remains above its trigger line in association with the upturn out of the half-trading cycle low. The Momentum indicator in the upper window remains above its zero line. The upturn of the stochastic in the middle window has moved to overbought levels, which now makes conditions ripe for a top. The first of our Primary Short-Term Indicators is the New High/New Low Differential, plotted with price, which also remains positive. The Trend Indicator remains below its trigger line. The price analog in red continues to be reflective of our general expectation. Copyright 2019 by Tim Wood 7

6 The Three Primary Short-Term Indicators are the Original and the Slow Cycle Turn Indicators, both plotted below, and the NYSE New High/New Low Differential, plotted with price above. The price action on Wednesday completed the formation of another daily swing low, but it was not until the additional advance on Friday that ALL Three of the Primary Short-Term Indicators turned up into gear, which in turn finally triggered a short-term buy signal. This buy signal is occurring very late into this trading cycle and in conjunction with short-term overbought oscillator readings. Therefore, this buy signal is iffy and should ideally be short lived, but it will remain intact until another daily swing high and downturn of ALL Three of the Primary Short-Term Indicators are seen. This continues to be an opportunity to cap the trading and intermediate-term cycle top and the price behavior in association with this half-trading cycle top remains key with respect to these tops. Copyright 2019 by Tim Wood 8

7 The Intermediate Term Breadth Momentum Oscillator remains marginally below its trigger line while the Intermediate Term Volume Momentum Oscillator has turned marginally above its trigger lines. Overall, the behavior here continues to be reflective of the trading and what should also ideally prove to be the intermediate-term cycle top as well. Copyright 2019 by Tim Wood 9

8 The McClellan Oscillator and Summation Indexes are also used to measure the intermediate- term internals. The Ratio Adjusted McClellan Oscillator in the upper window is shorter-term in nature and is therefore used to help identify the shorter-term tops and bottoms, but it is also useful in identifying intermediate-term cycle tops and bottoms. Both the McClellan Summation Index and the McClellan Volume Summation Index continue to weaken, which continues to be indicative of the trading and what should ideally prove to be the intermediate-term cycle top as well. The Ratio Adjusted McClellan Oscillator has turned back up and remains above its trigger line in association with the up turn out of the half-trading cycle low. Therefore, this indicator remains positive as we use it. Another down turn in association with the re-triggering of a short-term sell signal should serve to confirm that the trading and intermediate-term cycle top has been seen. Copyright 2019 by Tim Wood 10

9 Next is the Smoothed McClellan Oscillator, which remains below its trigger line. Copyright 2019 by Tim Wood 11

10 The Accumulation/Distribution Index remains above its trigger line in association with the upturn out of the half-trading cycle low. A downturn in association with the completion of a daily swing high will be suggestive of the half-trading cycle advance out of the March 11th low having run its course. Copyright 2019 by Tim Wood 12

11 The timing band for the next intermediate-term cycle low runs between April 19th and June 21st. The March 8th completion of a weekly swing high and the associated intermediate-term sell signal continues to be suggestive of the intermediate-term cycle top. The fact that we also have intermediate-term sell signals in some of the leading indexes, averages and sectors is also suggestive of the intermediate-term cycle top as well, but we have to get past the ongoing half-trading cycle advance. Once another daily swing high and shortterm sell signal is triggered, we should have the structure in place with regard to whether the intermediateterm cycle top has in fact been seen. As we await this confirmation, based on the intermediate-term sell signal and the associated evidence that we do have, the assumption is that the intermediate-term cycle top has been seen. I have left the dark blue scenario on the weekly chart below. If this scenario is not seen, it will force one of the other alternatives, which we will examine once we see how the decline into the intermediate-term cycle low unfolds. Copyright 2019 by Tim Wood 13

12 I have also included a monthly chart of my stochasticized CTI, which remains on a sell signal. In Summary, the March 11th low marked the half-trading cycle low and on Friday a short-term buy signal was seen on the Industrials. This trading cycle top continues to be an opportunity to cap the intermediateterm advance and the advance out of the half-trading cycle low continues to be the test with regard to that top. Ideally, the intermediate-term cycle top should be in place, but if not any additional advance should be an ending move into the top. Any weakness from here that completes the formation of another daily swing high will be suggestive of this half-trading cycle advance having run its course, which should in turn serve to confirm the higher degree intermediate-term cycle top. Copyright 2019 by Tim Wood 14

13 Gold End of Week Intermediate-Term Indicator Summary Intermediate-Term Sell Daily Indicator Summary Short-Term Neutral Primary Indicators Formation of a Weekly Swing High Cycle Turn Indicator (CTI) Confirming Indicators Trend Indicator (TI) Cycle Momentum Indicator Secondary Indicators Stochastic Primary Indicators Formation of a Daily Swing High Cycle Turn Indicator (CTI) Confirming Indicators Trend Indicator (TI) Cycle Momentum Indicator Secondary Short Term Indicators Stochastic The timing band for the trading cycle low ran between February 18th and March 5th and this low was seen on March 7th. With Friday having been an inside day, there were no changes with Gold. In light of the higher degree intermediate-term sell signal and what should be the intermediate-term cycle top, the expectation is for the advance out of the March 7th trading cycle low to be counter-trend, which means it should peak with a left-translated structure. With the price action on Thursday completing the formation of a daily swing high, Gold is now at risk of this anticipated left-translated top. Any further weakness that turns the daily CTI down will trigger a short-term sell signal, which will be further indicative of the countertrend advance out of the trading cycle low having run its course and that the anticipated left-translated trading cycle top has been seen. Any further advance from here should be a final push up into the trading cycle top. At a higher level, more confirmation of the seasonal cycle top is needed, but until Gold can prove otherwise, the assumption will continue to be that the higher degree seasonal cycle advance out of the August low has run its course. Copyright 2019 by Tim Wood 15

14 Next is the XAU and here too, the advance out of the March 7th trading cycle low should prove to be counter-trend and if so, it should peak with a left-translated structure. The advance out of the trading cycle low carried price to overbought levels this past week and it also reversed the previous week s intermediateterm sell signal. But, as a result of the short-term sell signal, the counter-trend trading cycle top should be in place. The next level of confirmation to this effect will be the completion of another weekly swing high and downturn of the weekly CTI. Copyright 2019 by Tim Wood 16

15 The weekly chart of the XAU is next. The advance this past week completed the formation of a weekly swing low that was accompanied by another upturn of the weekly CTI. In doing so, another intermediateterm buy signal was triggered, but based on the evidence and expectation with regard to the higher degree cycle top, this should be a counter-trend retest. If so, we should see this weekly swing high and intermediateterm buy signal reversed in conjunction with the decline out of the current short-term sell signal. Once a weekly swing high is re-formed and re-confirmed by a downturn of the weekly CTI on BOTH Gold AND the XAU, we should have confirmation that the intermediate-term cycle tops are in place, which should ideally cap the counter-trend advance out of the September low. A weekly swing high will be completed on the XAU in the coming week if is not bettered and if is violated. Copyright 2019 by Tim Wood 17

16 Next is our weekly chart of Gold. The intermediate-term cycle low was last seen the week of November 16th and the timing band for the pending intermediate-term cycle low runs between March 8th and April 26th. The evidence continues to be suggestive of this low having been seen the week of February 22nd and the intermediate-term sell signal and decline into the intermediate-term cycle low remains intact. Looking at the overall cyclical phasing and price/oscillator picture, there should be at least one more trading cycle down into the intermediate-term cycle low, which means that the current trading cycle advance should ideally peak with a left-translated structure. Once a short-term sell signal is re-triggered, Gold will be positioned for the resumption of the decline down into this higher degree cycle low. At a higher level, based on the evidence with regard to the 9-year cycle top, the expectation has been for the advance out of the August seasonal cycle low to be counter-trend and the current intermediate-term sell signal continues to be an opportunity to cap this counter-trend advance. A weekly swing high will be re-formed in the coming week if 1, is not bettered and if 1, is violated. Copyright 2019 by Tim Wood 18

17 Dollar End of Week Intermediate-Term Indicator Summary Intermediate-Term Buy Primary Indicators Formation of a Weekly Swing Low Cycle Turn Indicator (CTI) Confirming Indicators Trend Indicator (TI) Cycle Momentum Indicator Secondary Indicators Stochastic Daily Indicator Summary Short-Term Sell Primary Indicators Formation of a Daily Swing High Cycle Turn Indicator (CTI) Confirming Indicators Trend Indicator (TI) Cycle Momentum Indicator Secondary Indicators Stochastic The trading cycle low was last seen on February 28th and the timing band for the next trading cycle low runs between March 26th and April 9th. On Wednesday the Dollar completed the formation of a daily swing high and with the daily CTI having previously turned down, a short-term sell signal was triggered. With the price action on both Thursday and Friday being inside days, there has been no changes with the Dollar. The current price/oscillator picture leaves the Dollar at risk of a left-translated trading cycle top. But, because of the higher degree cycle low and the corresponding intermediate-term buy signal, current evidence continues to suggest that this decline is counter-trend. However, we must ultimately see this trading cycle unfold with a right-translated structure if the higher degree cycle advance is to remain intact, which means we must see the March 7th trading cycle top bettered. Therefore, the remainder of this trading cycle continues to be a critical time for the Dollar. A daily swing low will be completed on Monday if holds and if is bettered. Copyright 2019 by Tim Wood 19

18 Next is our weekly Dollar chart. The timing band for the current intermediate-term cycle low ran between January 11th and March 1st. With price now having moved through the timing band for this low, it has in fact proven to have bottomed the week of January 11th. The intermediate-term buy signal remains intact, but this past week was an inside week and the downturn of the Cycle Momentum Indicator and the stochastic are concerning in that they hint of a possible left-translated intermediate-term cycle top. But, at the same time, the weekly CTI remains positive and the Trend Indicator has turned back up above its trigger line and for this reason the recent weakness currently appears to be counter-trend at this level as well. Bottom line, I have to continue to give the Dollar the benefit of the doubt with regard to this intermediateterm cycle advance, but in order to keep it alive and if the higher degree seasonal cycle low was in fact seen in January, this intermediate-term cycle must continue higher and it must unfold with a right-translated structure. Otherwise, a left-translated intermediate-term cycle top will mean that the seasonal cycle low was not seen in January and another intermediate-term cycle down into that low should follow in the wake of such setup. It is the current trading cycle that is now so important with regard to the structure of the intermediate-term cycle. So, again, this trading cycle is an important technical juncture for the Dollar at this level. Bottom line, we do still have an intermediate-term buy signal in place and it is now the structure of this intermediate-term advance that will serve to confirm whether or not the higher degree seasonal cycle low has also been seen. Copyright 2019 by Tim Wood 20

19 Bonds End of Week Intermediate-Term Indicator Summary Intermediate-Term Neutral Primary Indicators Formation of a Weekly Swing Low Cycle Turn Indicator (CTI) Confirming Indicators Trend Indicator (TI) Cycle Momentum Indicator Secondary Indicators Stochastic Daily Indicator Summary Short-Term Buy Primary Indicators Formation of a Daily Swing Low Cycle Turn Indicator (CTI) Confirming Indicators Trend Indicator (TI) Cycle Momentum Indicator Secondary Short Term Indicators Stochastic The trading cycle low was seen on March 1st and the timing band for the next trading cycle low runs between March 22nd and April 12th. The weekly swing low seen this past week is indicative of the intermediate-term cycle low, but the next level of confirmation of the higher degree intermediate-term cycle low will be a right-translated trading cycle advance. The price action on Wednesday, Thursday and Friday has occurred within Tuesday s price range, so there have been no short-term structural changes. Given Friday s reversal, the short-term has improved and higher prices tend to be in the cards from this point, but the structure of this cycle is key. If the intermediate-term cycle low wasn t seen in conjunction with the last trading cycle low, then should a left-translated trading cycle top take hold here, it will leave Bonds set up for another trading cycle down into the intermediate-term cycle low. Any further advance that carries Bonds back above the March 12th high on a closing basis will be suggestive of the intermediateterm cycle low. Copyright 2019 by Tim Wood 21

20 Our weekly chart of Bonds is next and the timing band for the intermediate-term cycle low runs between February 1st and April 19th. The price action the week of February 2nd completed the formation of a weekly swing low that was confirmed by an upturn of the weekly CTI, plotted with price. In doing so an intermediate-term buy signal was triggered and the possibility of an early intermediate-term cycle low was on the table. However, I had explained that I would ideally like to see another trading cycle down into this low and the evidence thus far continues to suggest that this is what was seen in conjunction with the March 1st trading cycle low. The price action this past week put a weekly swing low into motion, which is suggestive of the intermediate-term cycle low, but we still need an upturn of the weekly CTI in order to trigger an intermediate-term buy signal. In addition, we also need to see this trading cycle advance unfold with a righttranslated structure. Upon these two developments, we should have confirmation of the March 1st low having marked the intermediate-term cycle low. Failure to see such developments in conjunction with this trading cycle advance should lead to a final trading cycle down into the intermediate-term cycle low. But, until that proves to be the case, based on this past week s completion of a weekly swing low, the assumption is that the intermediate-term cycle low has likely been seen. Copyright 2019 by Tim Wood 22

21 Crude Oil The March 11th short-term buy signal remains intact and has again carried price to overbought levels, per the stochastic. While this advance remains intact, the expectation continues to be that this is a countertrend advance and that it will peak in close proximity with Equities. With that said, until we see the triggering of a short-term sell signal that evolves into the completion of a weekly swing high and downturn of the weekly CTI, the turn in Crude oil is not yet. A daily swing high will be completed on Monday if is not bettered and if is violated. Copyright 2019 by Tim Wood 23

22 Below I have included a daily chart of the Oil Service Index, in red, with an overlay of Crude Oil. As was seen with the top in October, the non-confirmation seen by the OSX over the last month is another indication that this advance is counter-trend. Copyright 2019 by Tim Wood 24

23 Next, I have included a daily chart of Gasoline. The price/oscillator picture here is ripe for a top and on Friday a short-term sell signal was triggered, which is an opportunity to cap the advance out of the December low. If this short-term sell signal evolves into a weekly swing high and the triggering of an intermediate-term sell signal, then we will at that time have evidence of the higher degree intermediate-term cycle top. With both Crude Oil and Gasoline historically peaking in close proximity with each other, a top in Gasoline should also be reflective of a top in Crude Oil. Copyright 2019 by Tim Wood 25

24 Our weekly chart of Crude Oil is next. The intermediate-term buy signal and advance out of the December low remains intact while the divergent stochastic at overbought levels is suggestive of an intermediateterm cycle top. Upon the completion of a weekly swing high and downturn of the weekly CTI, an intermediate-term sell signal will be triggered, which will then be an opportunity for the intermediate-term cycle top to take hold. Until then, as I have explained, the turn in Crude Oil is not yet. A weekly swing high will be completed in the coming week if is not bettered and if is violated Cycles News & Views; All Rights Reserved timwood1@cyclesman.com Copyright 2019 by Tim Wood 26