MCM Newsletter – Outlook for Week 2-6 Nov

For the benefit of the general public, considering that we are approaching an important inflection zone, we will keep this post open, however the future weekly newsletters will be limited to members.

Executive Summary:
- Main Trend (weekly): down
- Intermediate Trend (daily): up
- Short-Term Trend (60min&135min): up
- MSP for the week: up

Details:
No significant change in the weekly cycle compared to the previous week. The impulse down which started in week 35 is still valid - the price sliced through the support level which triggered at 2061.75 ES and 17353 YM (point 1 on the chart), confirmed afterwards by the MCM MA (which also came down through the mentioned level). That means that the main trend is still down. Compared to last week, the price advanced a bit more above the break-down levels (point 2 on chart), however not significantly enough and the current movement would still qualify as a back-test of the down impulses. The past week did little in terms of confirmation, so we are looking to next 1 week, possibly also the week after, to either confirm the main trend down or a reversal.

Weekly Cycles

If the weekly cycles did little in terms of confirmation, the past week brought a significant development on the daily cycles. Namely the MCM MA confirmed (point 2 on the chart) the price break-out (point 1 on the chart) above the resistances triggered at 2015 ES and 17100 YM. That means that the cycle impulse up on the daily is confirmed. The impulse is still at an early stage, and it can be reversed, especially considering the weekly development. Which is why also on the daily what happens next week appears to be of critical importance for the intermediate term direction.

daily_1.11.

Daily Cycles

The 60 and 135min cycles added even more nests to their upward impulses, by breaking above the END (or 2nd END) of their previous up impulses (point 1 on the chart). Currently the 60min has put in a capitulation bar (yellow bar on the chart) with a support level right at the lower end of the bar at 2069.5 (point 2 on the chart). Interesting is that 135min has resistance turned support very close, at 2066.75 (point 3 on the chart) and if we bounce higher from here, this would qualify as another back-test of the up impulse generated there. So very short term a bounce is the most likely option shown by the 60 and 135min cycles. If the bounce does not materialize and we break below the indicated levels, that would be important since it would reverse the impulse up on 135min and generate an impulse down on 60min (after MCM MA confirms).

60&135_1.11.

60&135min Cycles

The MSP for next week points higher with a significant inflection point coming up if it has not already occured. After the market peaks there is MSP bias for weakness over the next 3 to 4 months. When pointing out inflection points in the long term MSP it is important to mention that + - 3-4 trading days would be considered close enough. Friday is shown on the MSP as the peak, so we can conclude that the likely top is sometime in the 2nd half on next week or, if it's later, in the 1st half of the week after.

Recently the markets have been leading/left translating their peaks and the market IS presently in the window for a turn...it is not the objective of MSP to pick the exact hour and day of an inflection point but rather to point out a region of probability - be alert to any clues that a turn is occuring.

 

1.11.ES_MSP2

Market Structure Projection

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