Folks,
Market Observations for the Week: The SPX gave us an EW 5-waves up on the gap-up open and may have finished a 3-wave upside correction from after the CPI report last Wednesday. Our solar-lunar tables predicted big volatility on Monday for the NDX and that came true after APPL announced that it was cutting back on its expenses for Q3. The hourly SPX turn window that was due last Friday at Noon EDT came in a half trading later this morning and left a lot of ugly candlesticks on tech stocks in the wake of AAPL’s news. Bitcoin made multi-week highs at 22785 before reversing down with the market. After testing 90.56 on Thursday’s Full Moon Timing Window, crude oil may be just giving us just a 3-wave upside correction as it tested $100 today – that is bearish. Gold tested $1695 on the 7/13-7/14 Full Moon Timing Window but only gave us a shallow 3-wave bounce today to test its R2 resistance pivot at $1723 before reversing down hard. The USD spiked to 109.29 on Thursday and then pulled back in an EW a-b-c correction on Monday to test its S1 support pivot at 106.9 before bouncing.
7/18/22 (Commentary for Monday) Monday followed the predicted solar-lunar volatility for today by giving us more blowoff from Friday in a gap-up open followed by a reversal down in tech stocks that looked terrible on the charts. It appears that the hourly turn window that was due at Noon EDT last Friday came in a half trading day late into this morning. After reaching multi-week highs of 22785, Bitcoin reversed sharply down with the market. Crude oil had a big day and tested $100 but the rally pattern from the Full Moon low at $90.56 on 7/14 looked just 3-wave corrective. Gold only gave us a shallow 3-wave bounce from its Full Moon low last week and tested $1723 before reversing down. The USD made a new high of 109.29 on Thursday but then declined in an EW a-b-c correction into Monday that tested 106.9 before getting a bounce. Our current holdings are ~80% cash and ~20% in physical gold/silver/platinum.
Big Picture on Stocks (UPDATED) – Today’s price action has tilted us to the bear side and we are looking for a pullback into the 7/21 turn window. Longer term, the SPX could give us a 20%-50% correction by spring 2023 as the 20-yr cycle low bottoms and the US economy slows to a recession. We favor a high percentage of cash for capital preservation.
Big Picture on PMs (UPDATED) – Gold spiked above $1720 but could not close there and ended the day testing $1700 again. A washout to test $1675 this week is likely.
- Stocks – The gap-up open tested a SPX downtrend line and turned the market down in the first hour. Our solar-lunar cycle for Monday predicted extreme volatility which we got. We favor the bear case here which calls for a move down into 7/21.
- Gold – Once again gold spiked above $1720 but could not close there. A move down to test $1675 is likely today.
- Silver – Silver tested $18 on Thursday’s Full Moon Timing Window but its bounce into the weekend looked corrective – we are now looking for a retest of $18 later this week.
- Bonds – Bonds fell back today and the 10-yr US rate got a bounce.
- Crude Oil – Crude oil rallied in 3-waves from its Full Moon low and is testing $100 overnight.
- Dollar Index – The USD made a high of 109.26 on Thursday before an EW a-b-c correction that pulled us back to 106.90 during Monday’s session.
TURNING POINT DAY
The turn window for this week is 7/21, the 34-day Fibonacci step out from the 6/17 low.
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