This massive spike in the dollar has caused me to reevaluate our current cycle count. I'll address each individually below in their respective places. Please check the "Cycles" link on the right hand side to see the updated cycles charts/counts.
$USD:
The dollar spiked today to find resistance right up against the 200 DMA and the 61.8% fibo level. I wouldn't be surprised for the trend buying to push it over these levels temporarily to create a short term overbought situation causing a quick liquidation back into the range. Price is also against upper channel resistance.
The Dollar is currently on day 12 of it's daily cycle. We thought day 8 was going to be our daily cycle peak, giving us an extremely left translated cycle. Since this was broken on Friday we now have a new daily cycle high. This may turn into a stretched right translated cycle. Regardless, the cross of the 50 DMA over the 200 DMA has always been a sign of the 3 year low. Once we establish this high, the rest of the cycle should move downward and eventually lead to the intermediate and yearly cycle lows.
Gold:
Gold dropped big on Friday. From the chart below, you can see it appears that it's not finished either. We should see some follow through until we find support on the 200 DMA and the 50% fibo. Also note the RSI has a long way to find support as well as the MACD. Any sign of a bounce Monday morning will most likely be heavily sold.
Gold had a previous daily cycle low of $1698. Since price broke that level, the idea that it's in a new intermediate cycle is invalid. Instead, we've started a new daily cycle in the last weekly cycle. This puts us on day 25 of the current daily cycle instead of day 5.
The weekly gold count is 24.
Silver:
Silver looks much the same as gold. It's still trading within a downward channel. It found exact support on the 50% fibo. This is just below the 200 DMA. Anymore weakness over the next couple of days while this price drop is digested will put us into extreme oversold territory.
With silver's cycles, we also have to change our count. The same scenario that we saw in gold is now in play with silver. We're currently on day 27 of the daily cycle. Take note of the declining daily cycle trendline. When the new daily cycle starts, that must be broken in order to confirm.
The intermediate cycle is on week 18. This puts us in the timing band for a weekly cycle low.. at an average of 18-22 weeks.
Stocks rallied on the NFP news early Friday morning. However, buying came to a halt at the 50 DMA and reversed for the rest of the day. Stocks appear to have much further to fall. Indicators have not bottomed and currently price hangs between the two DMAs. The 50% fibo is right in line with the 200 DMA. This would be a good target to find support.
Gold Miners - GDX:
Gold miners also took a hit on Friday. This was partly the fault of gold falling and also partly the fault of some missed earnings targets in big holders. Good news is that the bad news is already out. The bad news is that GDX needs to find support before it turns. You can clearly see the channel that GDX is trading in. The 50 DMA pressed price upward until the channel forced it to break. The next place will be the 200 DMA. The 50 over 200 DMA cross should propel prices much higher after we bottom.
Let's look for a final bottom in metals over the next 2-3 days. From there, the sentiment will be at rock bottom and indicators will show oversold. It will be a great time to buy.
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