Cycle Trading: SOS Signal

LikesMoney Independent Analyst

Stocks closed below the upper daily cycle band on Wednesday to confirm that it was day 60 of an extended daily cycle.

Stocks formed a swing low on Thursday. Stocks also broke clearly above the declining trend line to close above the declining 10 day MA. With stocks being so late in their timing band this indicates that Thursday should be day 1 of the new daily cycle.

We can also see that both the Russell and the Transports also managed to close above their respective declining 10 day MA's to signal new daily cycles.

And with this type of agreement normally I would feel pretty confident that Thursday was day 1 of a new daily cycle. But there was a bearish signal that was delivered on Thursday.

Stocks printed a large SOS number on Thursday. The 701 million selling on strength is the type of number that will be printed prior to an intermediate cycle decline. It is certainly not the type of number the we typically see as stocks emerge from a daily cycle low.

So whether or not stocks still have more to correct or if stocks are preparing to form a left translated daily cycle remains unknown.

But the 701 million SOS clearly indicates risk ahead ..

Author

LikesMoney

Independent Analyst

Assets (such as stocks, gold, and the dollar) have identifiable cycles.

EUR/USD hits two-day highs near 1.1820

EUR/USD picks up pace and reaches two-day tops around 1.1820 at the end of the week. The pair’s move higher comes on the back of renewed weakness in the US Dollar amid growing talk that the Fed could deliver an interest rate cut as early as March. On the docket, the flash US Consumer Sentiment improves to 57.3 in February.

GBP/USD reclaims 1.3600 and above

GBP/USD reverses two straight days of losses, surpassing the key 1.3600 yardstick on Friday. Cable’s rebound comes as the Greenback slips away from two-week highs in response to some profit-taking mood and speculation of Fed rate cuts. In addition, hawkish comments from the BoE’s Pill are also collaborating with the quid’s improvement.

Gold climbs further, focus is back to 45,000

Gold regains upside traction and surpasses the $4,900 mark per troy ounce at the end of the week, shifting its attention to the critical $5,000 region. The move reflects a shift in risk sentiment, driving flows back towards traditional safe haven assets and supporting the yellow metal.

Crypto Today: Bitcoin, Ethereum, XRP rebound amid risk-off, $2.6 billion liquidation wave

Bitcoin edges up above $65,000 at the time of writing on Friday, as dust from the recent macro-triggered sell-off settles. The leading altcoin, Ethereum, hovers above $1,900, but resistance at $2,000 caps the upside. Meanwhile, Ripple has recorded the largest intraday jump among the three assets, up over 10% to $1.35.

Three scenarios for Japanese Yen ahead of snap election

The latest polls point to a dominant win for the ruling bloc at the upcoming Japanese snap election. The larger Sanae Takaichi’s mandate, the more investors fear faster implementation of tax cuts and spending plans.

XRP rally extends as modest ETF inflows support recovery

Ripple is accelerating its recovery, trading above $1.36 at the time of writing on Friday, as investors adjust their positions following a turbulent week in the broader crypto market. The remittance token is up over 21% from its intraday low of $1.12.