not much has changed

In terms of the current (weekly) inverted cycle.  398-weeks off the lows into the most recent all-time high.

Gold lower

Not looking good for Gold.  I had hope for it a few weeks ago, but sell stops were unwound.
My premise a while ago was that it could be forming a cup w/ handle pattern, but since that posting, the handle (channel) broke down further.

The daily (above, right) looks a bit oversold at this point, so I can see a pullback higher to try and regain the weekly (above, left) lower channel.  If buyers are attracted then I can see a buy divergence on the weekly playing out, but the ball is obviously in the bear court.

Looking at the monthly (below, left) I can imagine that if 1529 gives then I think it can get messy.

Just for kicks, below is the weekly cycle count, since it has been consolidating for 77-weeks (I believe).  Previously, it spent 100-weeks in a bullish frenzy after a consolidative breakout.  So, it seems about right that it is consolidating as much as it has been in order to give symmetry to the previous bullish momentum.
The red line represents the price and time target based on the previous Inverted Cycle.  The fuchsia line is the cyclic trend line (CTL in the Stevenson PTT concept) which is the trendline needed to be broken in order to consider the current Regular Cycle ended and the next inverted cycle to begin.

cycling

Updated:
   If you're not familiar with Stevenson Price & Time Targets you can go to this link.
In the chart below; fuschia line being the CTL and Red lines being the time targets

symmetrical cycles building on the SPY ....holding that 50% retrace looks bullish

 update
the cycle gets tighter

corrective cycle

While the Stevenson PTT concept is a bit difficult to read in trending markets it does tend to be clearer in range-bound or corrective markets.  Take the SPY for instance;  going back over the past month price has adhered to roughly a 10-day cycle while it tries to determine a direction for a more sustained move.

I have never really been satisfied with the reliability of the Stevenson target projections (red line), but the CTL (purple line) usually holds true to definition (CTL = Cyclic Trend Line, where a close outside this line indicates the beginning of your next cycle phase).

Here was another classic corrective cycle last summer with very symmetrical cycle lengths

Cycle update

Thought I would update the bar count on the S&P500 cycles.  If you're not familiar with the Stevenson PTT you can refer to the link embedded here.

Spanning the years 1995 through 2007 the S&P enjoyed quite a symmetrical cycle phase.  We had:
- A 64-month rally from 1995-1999 followed by a 31-month selling phase for a total of a 95-month long cycle.
- The 2002-2007 rally lasted for 61-months, culminating in a 92-month long Inverted Cycle.
- With extreme volatility came the completion of our next Regular Cycle which lasted only 78-months due to the rapid selling which took place over the course of 18-months between Nov. 2007 & March '09.

 The end of one cycle and the beginning of another is determined (by Stevenson) by the close outside of its Cyclic Trend Line or CTL.  This actually happened back in July of 2011.  The chart below shows a closer image and adds the CTL (magenta trend line), highlighting the price close beyond that point:

 What is interesting is that IF the long time frame Inverted Cycle has concluded it would have done so in 44-months, which is pretty close to half the length of the previous three cycles (which would make sense given the extreme volatility).  We can't say for sure that the cycle is complete (as price did make a higher low) and price is just throwing back to the CTL, or if the cycle is still intact.  We can only say for sure that the cycle is still intact IF price takes out the May 2011 highs, in which case we would re-draw our CTL and consider the Inverted Cycle to remain intact.

Since the 2009 lows price has formed some pretty symmetrical intermediate cycles that have averaged 16 months in length, of which we are in the 9th month of an inverted cycle whose price and time target (red dash line) is just beyond the May 2011 high, projected to be within 7-months.  Again, prices beyond the May 2011 high means that the longer-term inverted cycle is still intact.

energizer bunny rally

In yesterday's post I marked up a chart of the SPY using the Stevenson PTT method. Here's a continuation of that chart into today's session.As you can see the target for the Regular Cycle after the open came right on time and fell within a penny of the PTT. It also happened to fall within previous volume clusters and Tuesday's Point of Control(more on this later). The ensuing rally out of this area then formed our Inverted Cycle and, though it rapidly approached the PTT, fell short of the mark before entering it's Regular Cycle. Two things can be garnered from the two middle cycles today.
- The first IC of the day fell short of it's target, but approached it in a rapid pace.
- The RC that followed fell well short of it's target, and instead morphed into smaller cycles on the smaller time frame, turning price higher, like so:
Back to the volume cluster levels. Here's a look at the most recent day's volume distribution, where I marked the strongest levels. Yesterday's distribution level $115.11-115.16 is our VPC. Transferring those levels onto a price chart, here are the 3 bands I was looking at going into today:
The lower range acted as nice support, while the VPC from yesterday was a level of potential resistance (though we didn't quite make it that far this morning, price did hesitate within it later in the afternoon). The middle set of hash marks ($114.92-114.8) saw price acceptance rotate within it's range through most of the day.
The price congestion at the Open is highlighted in a rectangle. At this point a surge of volume allowed our open to act as support.

It seems that the only hope for a bearish outcome to this rally (even if that merely means a reasonable pullback) may be a 2B top. In which case we should look for a close under today's low within these next few sessions.

back forth testing

These past two days in the SPY gave nice, clear cycles as explained in the Stevenson Price & Time concept. Starting with the nice arching Regular Cycle from yesterday, this morning's Inverted Cycle quickly achieved it's upside PTT, while the next Regular Cycle came awfully close to tagging it's price and time target (this sort of cycle analysis isn't meant as a stand alone strategy, so if you're short on the last half of this RC a better profit target may be the day's Open). Later in the day we got some smaller time frame cycles interspersed so the symmetry began to fade.
Interesting setup we have on the Daily SPY chart, with a confluence of resistance points.
- We have price sitting in the sweet spot of a Bearish Wolfe Wave where the time objective comes around tomorrow.
- A blatant momentum sell divergence
- 161.8% Fibonacci Retracement level
- 100% Fibonacci Extension level
All as volume has increased these last two days.

nr z-day

Friday being a trend day, we followed through to Monday with a narrow range "z-day" (consolidation/oscillating day). A pointer (as far as L. Raschke teaches anyway) for these z-days is to watch the last hour's low (in the case of a trend day up) for potential support (or the most significant swing low in that 3:00pm area). In today's case, we came close, but didn't quite test that last hour trend day low.If you're able to stand the noise and focus on objectives, a z-day may also entail fading strength/weakness by perhaps using Bollinger Bands as a guide. While today's early morning range was very choppy between the highs and the Open, the lows of the day were put in near Friday's last hour low in the form of a Phoenix setup.
Today was a day where we just oscillated around vwap, so it may have been a good strategy to just play the extremes away from vwap by looking for TICK divergences and cover when reverting to the mean.
The first divergence of the day was a reverse divergence (higher TICK highs corresponding with lower price highs). The "Phoenix setup mentioned above was done on a TICK buy divergence, while the later afternoon test of the highs registered a TICK sell divergence.
I was alerted (reading the starwealth blog) to the fact that we may find ourselves in a bearish Wolfe Wave pattern. If this is the case we need to see a strong volume push (at the very least) into this 5-point, around $115.
After looking at the chart above I wanted to add in the Stevenson PTT for old time sake, because the cycles really jump out at you. Currently we're in an Inverted Cycle and it's a toss-up as to which will be achieved first; the breach of the CTL beginning a Regular Cycle down, or the Price & Time Target at the $116 level (read more about how these targets and triggers are obtained by reading the link above for Stevenson PTT.

SPY PTT

Below is a 30-min chart of the SPY with the Inverted and Regular Cycles (as I wrote about last weekend). Here is the same chart, only this time including the PTT's (red line - Price and Time Targets) and the CTL (purple line - Cyclic Trend Line). Confused?Well, the hardest problem I have seen with Stevenson Price and Time Targets was determining when the Inverted Cycle ends and the Regular Cycle begins in real-time. According to Stevenson, this happens when price makes a close outside of the CTL.

As a refresher, the Cyclic Trend Line (CTL) is drawn by connecting the most recent swing low to high, this line is then moved outward so that it touches only a single price point.

However, when doing this in real-time you'll never know whether the previous high will be taken out (invalidating the end of the Inverted Cycle and confirming the continuation of the Regular Cycle in which you're in), so you'll have to continuously watch for strength or weakness at previous swing highs/lows (perhaps a very good habit to be in).

For example; If you're in the second half of an Inverted Cycle (price moving higher) you will be expecting a transition into the beginning of a Regular Cycle once price breaks the CTL). But once price breaks the CTL there is still just as much likelihood that price may continue making higher highs. Therefore, you should always be looking for a retest of the CTL, or some sort of price topping (or bottoming) pattern.
Referring back to the above overview chart (30-min) that includes CTL's (purple lines), I'll include the same CTL's on our trading chart (the 5-min).

This first chart shows the day of Jan. 20. where we're in the tail-end of a RC. Price closes outside of the CTL, but that's not an actionable signal. We wait for price to tell us whether we'll likely make a lower low (and continue the Regular Cycle), or whether we should look to get long in anticipation to ride the beginning of an Inverted Cycle up.
After a low was made, price rose and tested the previous support level, before selling off (market internals likely telling you to sell resistance?). Price then began to stabilize and base at that resistance level, before breaking out, much more of an actionable sequence.

Now lets move to the end of that day and the beginning of the following Thursday. We have a Cyclic Trend Line in place which price tests at the open. Right away we get a bear flag, Open range breakdown out of the CTL (beginning our Regular Cycle down).Once this CTL is broken we anticipate the beginning of an Inverted Cycle. We see a bottoming pattern develop in the form of an Inverse Head & Shoulders, we buy the breakout, but price gets sold. OK, so we get stopped out, but we learned a valuable piece of information. We learned that sellers are still prevalent in the market and price may want to go lower (at least to test the lows perhaps).

Finally, I'll include the last two days in the SPY with the CTL's in place. Notice we had closes outside of the CTL with some tradeable pullbacks to this line that coincided with technical patterns (i.e. a Head & Shoulders breakdown into the close of 1/21 and the open of 1/22, a lower high breakdown around 12:30 on the 22nd).
I hope this isn't too difficult to follow. If it is, I would love to hear from people who might have valuable input. Anyway, trade in the direction of the cycle!

Quick Update

I showed this chart yesterday, and wanted to include an update.
Price hit the PTT early (a sign of strength) and the Inverse Cycle is still intact.

Charts with PTT

Following up on my previous post regarding Stevenson Price & Time Targets, here are a couple charts I've been looking at:
TLT
Recently finished a Regular Cycle (RC) down. The overhead red line marks the PTT and the purple lines mark the Cycle Trend Line (CTL). Within these larger cycles, there are also smaller cycles at play (though we should dial down too far, or risk falling down the rabbit hole. Notice that both cycles have approximately the same number of bars in them. The previous Regular Cycle ended when price closed outside the CTL (ended up retracing towards it before continuing). The Inverted Cycle's PTT was overshot, but arrived right on time (this is either showing us strength or short covering, or a combination of both being that price was right on top of long-running support.
From here we look for a close outside the CTL to determine the end of the current Inverted Cycle (though we should prefer to wait for a retracement back to this CTL to gauge whether price wants to continue higher, or fall lower). The PTT of the Inverted Cycle is the most current red line on the chart, there is strong support above it though, and the slope of this down trend is beginning to flatten.

FCX
This stock finished the week, printing a Dark-Cloud Cover pattern, after filling a long-term gap. The daily chart shows the most recent end to an Inverted Cycle that actually hit the PTT early. The current PTT is drawn in red while the CTL is purple. There are two clear possibilities; (1) Continued downside, where we could target the PTT, and perhaps look to buy a bounce, or (2) Price makes an attempt to tag the CTL above, in which case I would be looking to sell this move.