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June 8, 2015

Stocks to Drop and Pop.... Again

Stocks are now moving to copy gold by confirming a weekly cycle decline.

The Day 10 peak for the current daily cycle easily delivers a left-translated nature, and we should expect prices to continue lower for another 2-4 weeks in order to form a low within the daily cycle's time band.

Unlike gold, however, stocks are not facing a left-translated weekly cycle.

A right-translated nature implies that a cycle low should be found above the weekly LowerBand, which is now at SPX 2034 and rising. Even with a bit of overthrow on the LowerBand, the SPX is almost certain to defend its 75WMA, so some extra volatility might take the index down to a minor dip below 2000, just to get so bear hearts racing before setting an important low. As you all know, a RT cycle should be followed by a cycle that sets a higher high, so I expect new equity highs by late summer.

 

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