Cycle Turn Indicator Direction and Swing Summary …...The price action on Wednesday reversed off of...

Cycle Turn Indicator Direction and Swing Summary

of Select Markets as of the close on

May 21, 2020

*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

Market Daily CTI

Daily Swing

Weekly CTI

Weekly Swing

Industrial Positive Low Positive LowTransports Positive Low Positive Low

NDX Positive Low Positive LowS&P Inverse Fund Negative N/A * Negative High

CRB Index Positive High Positive LowGold Negative High Positive LowXAU Negative High Positive Low

Dollar Negative High Negative HighBonds Positive Low Negative High

Crude Oil Positive Low Positive LowUnleaded Positive High Positive Low

Natural Gas Positive High Negative High

© Copyright 2020 by Tim Wood �3

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.


http://www.cyclesman.info/New%20Subscriber%20Info.htm

May 21, 2020

Stocks

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The timing band for the current trading cycle low on the Industrials runs between May 1st and May 22nd. The developments this week continue to be suggestive of this low having been seen on May 14th rather than on May 4th. While the advance out of this low remains intact, the oscillator picture is conducive of a top. Nothing has taken hold here yet, but the opportunity is certainly there for it to do so. If we see the completion of a daily swing high and the triggering of a short-term sell signal, it will leave Equities at risk of

End of Week Intermediate-Term Indicator Summary Intermediate-Term Neutral Primary Indicators Formation of a Weekly Swing High BearishCycle Turn Indicator (CTI) BullishCTI on Rydex Tempest Fund * BearishConfirming IndicatorsTrend Indicator (TI) BearishAdvance/Decline Issues Diff BearishNew High New Low Diff BullishSecondary Indicators

5 3 3 Stochastic BearishCycle Momentum Indicator Bullish*When this indicator is Bullish it is negative for the market and visa versa.

Daily Indicator Summary Short-Term Buy/NeutralPrimary Indicators Formation of a Daily Swing Low BullishCycle Turn Indicator (CTI) BullishSlow Cycle Turn Indicator (CTI) BullishNew High/New Low Differential BearishConfirming IndicatorsTrend Indicator (TI) BullishMcClellan Intermediate Term Breadth Momentum Oscillator (ITBM)

Bullish

McClellan Intermediate Term Volume Momentum Oscillator (ITVM)

Bullish

McClellan Summation Index BullishMcClellan Volume Summation Index Bullish

Secondary Short Term Indicators5 3 3 Stochastic BullishCycle Momentum Indicator BullishTrading Cycle Oscillator BullishMomentum Indicator BullishRatio Adjusted McClellan Oscillator Crossover

Bullish

Accumulation/Distribution Index Bullish


the trading cycle top, which as a result of the overall structure, will set the market up in a vulnerable position. Given the overall price/oscillator picture, this is indeed a critical technical juncture, but until a daily swing high is confirmed by the triggering of a short-term sell signal, this advance will remain intact. A daily swing high will be completed on Friday if 24,718.46 is not bettered and if 24,370.88 is violated. More on this as it develops.

The buy signal in Crude Oil and the CRB Index remains intact. The oscillator pictures here are also conducive of a top and in the case of the CRB, we saw the completion of a marginal daily swing high on Thursday. But, until we see daily swing highs and short-term sell signals, there is no evidence this advance has run its course. Gold and the XAU triggered short-term sell signals on Thursday and in the case of the XAU, we appear to have a left-translated trading cycle top trying to take hold. The short-term sell signal on the Dollar remains intact and as a result it remains at risk of a left-translated trading cycle top, which if not corrected is going to be further suggestive of the intermediate-term cycle top as well. That said, the Dollar has now also moved into a position to bounce, which will again leave the Dollar in a position to correct this left-translated structure. Per the Tuesday night update, I said that I was optimistic that Bonds had made another push down into the trading cycle low and that until proven otherwise we would operate under the assumption that this was the case. As a result of the price action and short-term buy signal that has since been seen, that read on Bonds appears to have been correct. There has been no change in that everything remains at a critical cyclical crossroads.

The red intermediate-term Advancing issues line is tied to the intermediate-term cycle. This indicator turned back up on Wednesday and ticked back down on Thursday. A crossing of the trigger lines in conjunction with the triggering of a short-term sell signal will be suggestive of a higher degree turn.


The Trading Cycle Oscillator in the upper window remains above its trigger line. The Momentum indicator remains above its zero line. The 5 3 3 stochastic in the middle window is now trying to turn down from overbought levels. The structural test at hand was confirmation of whether we had a failed and left-translated trading cycle at play, or if we were seeing another push down into the trading cycle low. As a result of the development this week, it proved to be the latter. Now, as a result of the current price/oscillator picture, the structural test is whether we see the completion of a failed and/or left-translated trading cycle top as we move out of the trading cycle low. The first of our Primary Short-Term Indicators is the New High/New Low Differential, plotted with price, which has ticked back down. The Trend Indicator remains above its trigger line.


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.

Both the Original and the Slow Cycle Turn Indicators turned up on Monday, which triggered short-term buy signals in association with the trading cycle low. Upon the completion of a daily swing high and downturn of ALL Three of the Primary Short-Term Indicators, a sell signal will be triggered and the opportunity for a turn will once again be at hand. For now, while the oscillator picture has ripened for a top, this buy signal will stand until a daily swing high is formed and confirmed by the triggering of a short-term sell signal.


The Intermediate Term Volume Momentum Oscillator has turned back up, which is also reflective of the trading cycle low. The Intermediate Term Breadth Momentum Oscillator remains positive.


Both the McClellan Summation Index and the McClellan Volume Summation Index remain positive. The Ratio Adjusted McClellan Oscillator made a minor ticked down on Thursday. Another downturn below the zero line in association with the triggering of a short-term sell signal will be suggestive of the trading cycle top.


The smoothed McClellan oscillator has turned back above its trigger line, which is also reflective of the trading cycle low. Here too, another downturn in association with the triggering of a short-term sell signal will be reflective of the trading cycle top. The key will be the structure that is in place at the time of that sell signal.


The Accumulation/Distribution Index has continued turning up this week, which is also reflective of the trading cycle low. Another downturn, in association with the triggering of a short-term sell signal, will be suggestive of a left-translated trading cycle top. Again, this remains a critical juncture for not only Equities, but pretty much all asset classes. More in the weekend update.


Gold

On Thursday Gold completed the formation of another daily swing high that was confirmed by a downturn of the daily CTI, which triggered a short-term sell signal. The timing band for the next trading cycle low runs between May 15th and May 29th. As a result of the May 18th daily swing high and Thursday’s sell signal, the trading cycle top should be confirmed as should the decline into the trading cycle low. Gold remains at risk of the intermediate-term cycle top, which thus far remains left-translated. Depending on the structural developments in association with the decline into the trading cycle low, we may still prove to have this higher degree cycle top in place. The completion of a weekly swing high and the triggering of an intermediate-term sell signal will certainly tip the scales further in that direction. As with the Dollar, Bonds and Equities, Gold remains at a critical juncture. A daily swing low will be completed on Friday if 1,715.30 holds and if 1,751.70 is bettered.

End of Week Intermediate-Term Indicator Summary Intermediate-Term Sell/Neutral

Primary Indicators

Formation of a Weekly Swing High BearishCycle Turn Indicator (CTI) BearishConfirming IndicatorsTrend Indicator (TI) BullishCycle Momentum Indicator BullishSecondary Indicators

5 3 3 Stochastic Bearish

Daily Indicator SummaryShort-Term Sell

Primary Indicators

Formation of a Daily Swing High BearishCycle Turn Indicator (CTI) BearishConfirming IndicatorsTrend Indicator (TI) BearishCycle Momentum Indicator BearishSecondary Short Term Indicators

5 3 3 Stochastic Bearish


The price action on Wednesday reversed off of the highs and on Thursday price completed the formation of a daily swing high that was confirmed by a downturn of the daily CTI. In doing so, a short-term sell signal was triggered and the trading cycle top should be in place. As a result, the cyclical phasing here seems to be in sync with the broader Equity markets, which in light of this short-term sell signal puts the XAU at risk of a left-translated trading cycle top. Given the current price/oscillator picture, until another short-term buy signal is triggered and the XAU can prove itself otherwise, we will assume this to be the case. If we do in fact prove to have a left-translated trading cycle top here, then we should also see the completion of a weekly swing high and intermediate-term sell signal, which will be suggestive of the higher level cycle top/s as well. A daily swing low will be completed on Friday if 121.51 holds and if 126.48 is bettered.


Dollar

The timing band for the trading cycle low ran between April 23rd and May 6th. There has been no change in that the evidence continues to be suggestive of the trading cycle low having been seen on May 1st. The decline in association with the May 15th short-term sell signal remains intact and as a result, the Dollar remains at risk of a left-translated trading cycle top. Thus far, the May 1st daily swing low has held and if we see the triggering of a short-term buy signal prior to a violation of that low, the Dollar will be repositioned to correct this possible left-translation. Bottom line, as I have said all along, in order to keep the higher degree intermediate-term structure intact, the advance out of this trading cycle low must better the April 6th trading cycle top and it must unfold with a right-translated structure. A short-term buy signal at a level above the May 1st low will give the Dollar that chance. As I have also been saying, this remains a critical juncture for the Dollar. A daily swing low will be completed on Friday if 99.00 holds and if 99.57 is bettered.

End of Week Intermediate-Term Indicator Summary Intermediate-Term Neutral

Primary Indicators Formation of a Weekly Swing Low BullishCycle Turn Indicator (CTI) Bearish

Confirming IndicatorsTrend Indicator (TI) Bullish

Cycle Momentum Indicator BearishSecondary Indicators5 3 3 Stochastic Bullish

Daily Indicator SummaryShort-Term Sell/Neutral

Primary Indicators Formation of a Daily Swing High BearishCycle Turn Indicator (CTI) Bearish

Confirming IndicatorsTrend Indicator (TI) Bearish

Cycle Momentum Indicator BearishSecondary Indicators5 3 3 Stochastic Bearish


Bonds

The timing band for the trading cycle low runs between May 5th and May 25th. As previously discussed, it originally appeared as if this low was seen on May 6th, but anytime a low occurs in the early portion of a timing band, it is always a possibility for there to be another push down into the low as we move through the remainder of the band. On Monday we saw the completion of a daily swing high and on Tuesday Bonds reversed off the low and as of the Tuesday night update I explained that I was optimistic we had seen another push down into this low. On Wednesday price completed the formation of a daily swing low and on Thursday the upturn of the daily CTI triggered a short-term buy signal. Until proven otherwise, the assumption is that we have seen another push down into the trading cycle low. Any further advance over the next couple of days will serve as further evidence to this effect and in order for the intermediate-term structure to remain positive, we now have to see the advance out of this trading cycle low unfold with a right-translated structure and it must carry Bonds above the previous trading cycle top. Therefore, this remains an important juncture for Bonds.

End of Week Intermediate-Term Indicator Summary Intermediate-Term Sell/NeutralPrimary Indicators Formation of a Weekly Swing Low BullishCycle Turn Indicator (CTI) BearishConfirming IndicatorsTrend Indicator (TI) BullishCycle Momentum Indicator BearishSecondary Indicators5 3 3 Stochastic Bearish

Daily Indicator SummaryShort-Term BuyPrimary Indicators Formation of a Daily Swing Low BullishCycle Turn Indicator (CTI) BullishConfirming IndicatorsTrend Indicator (TI) BearishCycle Momentum Indicator BearishSecondary Short Term Indicators5 3 3 Stochastic Bullish


Crude Oil

The oscillator picture is extremely ripe for a top and once a sell signal is triggered it will be an opportunity to cap the advance out of the April low. Until such time, this buy signal will remain intact and higher prices will remain possible. Longer-term, because of the higher degree cyclical structure and phasing, the expectation of this being a counter-trend advance stands. A daily swing high will be completed on Friday if 34.66 is not bettered and if 33.26 is violated. Once a short-term sell signal is triggered, the next indication of the counter-trend advance having possibly run its course will come with the completion of a weekly swing high and intermediate-term sell signal.

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