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MCM Newsletter – Outlook for the Week 13 – 17 Mar

The action seemed to change ever since the market hit the round numbers 2 weeks ago. The market made lower lows in 4 out of 5 trading days last week. Friday saw a bounce coming, but that bounce proved weak, ending with a cross type of daily candle (close equals the open, despite the intra-day swings. Usually points to a change of trend, or indecision).

The weekly cycles saw finally a clearer retrace and “dent” in the up move. The up impulses are still fully ongoing, so the picture is still bullish.

Weekly Cycles

The daily cycles show more clear where the decline stopped. The mcm-MA managed to provide support yet again - it did so several times in the past, so at least for now, the picture is still bullish. No new signal, except the fact that the directionality tool moved down, being the first bearish sign in a while.

Daily Cycles

The 288 and 480min cycles    
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MCM Newsletter for week 6-10 March

Last week was another one for the history books. The last 2 days of February seem uneventful in retrospect, although the market did make a new ATH on Monday before moving side-ways to lower afterwards. But March started with a bang. 15+ SPX points gap up and besting the 2400 level, which was almost 40 points higher than Tuesday’s close. Very impressive. However the round number proved to be not so lucky, as the next day we got an almost identically sized candle in the opposite direction. Friday saw the market making another low, before recovering to finish just above the close on Thursday.
The weekly cycles did not register any significant change as a result of this action. YM just confirmed the up impulse with the mcm-MA directly slicing the resistance level. ES is in an established up impulse. Interestingly the directionality tool is still at its maximum level, so that would provide a clue is the decline is more than a short-term correction, in case it moves lower.

Weekly Cycles

The daily cycles are perfectly aligned with the weekly. Up impulses, directionality pegged at the highest level. They are likely to move before the weekly, which would be an early warning.

Daily Cycles

The 288 and 480min cycles
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mcm Newsletter – Outlook for Week 30 Jan – 3 Feb

The market finally broke the side-ways movement last week and moved decisively higher. Both ES and YM made new ATHs, ES breaking 2300 and YM 20.000.
As a result, on the weekly cycles both ES and YM moved above their resistance levels. ES is starting to look like an attempted break-out, while YM only briefly spiked above. Next week looks to be important because if the market continues to move higher, the break-out on ES above the resistance level might be confirmed. Which would be full-on bullish.

Weekly Cycles

ES and YM are in even more different situations on the daily cycles. ES broke also here above it's resistance level. However YM bounced off its bullish retrace (BR) support but didn't trigger a resistance yet. Once it will, that would mark the last stand for bears and likely a good chance to turn things around. If they cannot and we get impulses up on weekly and daily, then it's likely the market will go a lot higher.  The directionality tool started to bounce from the lowest level which is a sign that the market is trying to push higher.

Daily Cycles

The 288 and 480min cycles    
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MCM Newsletter – Outlook for the Week 23-27 January

The market continued to move side-ways in the holiday shortened last week, the 4 trading days being mostly non-eventful with choppy moves inside a rather tight range.
Considering the side-ways movement, no surprise that there is no change on the weekly cycles. YM is still below its resistance level, while ES is above but still in close range.

Weekly Cycles

The daily cycles had again important developments. ES triggered an END resistance marking potentially the unwind of the up impulse. While YM triggered a bullish retrace (BR) support. These are mixed signals, in that the ES resistance normally would point to a down move, while the YM support would point to a bounce until a corresponding END is triggered. Usually that means choppy moves ahead, until the market makes up its mind which way to go. Regardless of what happens, the levels triggered are important to watch as a break-out of one or the other would be a strong message. The directionality tool is still stuck at its lowest level and provide a good clue if it moves (or if it doesn’t move and we get a bounce).

Daily Cycles

The 288 and 480min cycles    
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MCM Newsletter – Outlook for the Week 16-20 January

After the new ATHs from 2 weeks ago, the market moved mostly sideways during last week, in a choppy move that looks more like a correction/consolidation than a change of trend.
As the market didn’t move much in terms of points, there is no change on the weekly cycle. YM is still respecting its resistance level, while ES spiked above but didn’t break out. The directionality tool is becoming thick which likely anticipates a turn (lower in our case), but that can still take a while.

Weekly Cycles

On the daily cycles we had a rather interesting development. Both YM and ES are in up impulses and held the initial decline. And ES painted a bullish retrace (BR) support in a sign that the up impulses is unwinding. That points up, until a corresponding END resistance shows up. Directionality is still stuck at the lowest level which is not supportive for a sustained up move.

Daily Cycles

The 288 and 480min cycles    
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MCM Newsletter – Outlook for the 1st Week of 2017

Happy New Year!
The market action in the last week of 2016 was on the bearish side. After attempting to continue the pre-Christmas bounce when the market reopened on Tuesday, the market declined on all remaining trading days for an almost 40 points decline from Tuesday’s high to Friday’s low. The pattern of higher lows and lower highs which we were noticing a while back was broken to the downside.
The market’s decline was enough to finally trigger a resistance level on the weekly YM cycle. That is a big deal and an important line in the sand going forward. The normal expectation is for downside from here, especially since ES also came back below its previously triggered resistance which was a bit whipsawed at first.

Weekly Cycles

The daily cycles are in up impulses, however the directionality tool turned down and made it to the lowest level. Watching for a bearish retrace (BR) support to trigger and the market’s reaction to that would be important. If the market continues its decline it will be also important to see how it behaves when ES will back-test the break-out level at 2212.

Daily Cycles

The 288 and 480min cycles    
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MCM Newsletter – Outlook for last Week of 2016

Happy Holidays to everyone! The market action in the pre-holiday week was what one would expect. It looked like many participants decided to spend time shopping for presents instead of trading the market, which is why no real conviction was present to push the prices one way or another. The action was mainly sideways with the Friday close being 1 point away from Monday’s close. The higher lows and lower highs formations which we were mentioning last week are still intact and the wedge is getting smaller so resolution is expected shortly.
Considering the lack of direction, it is no surprise that there is nothing new to report on the weekly cycles. Market is still whipsawing the resistance level on ES, while YM is yet to trigger a resistance.

Weekly Cycles

No drastic change on the daily cycles either. The only notable change is that the directionality tool on both ES and YM started to move lower. It would be important to see if it makes it to the lowest level and how it reacts from there.

Daily Cycles

The 288 and 480min cycles    
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MCM Newsletter – Outlook for Week 19 – 23 Dec

Last week was a bit dull compared to the one 2 weeks ago, but the market was still able to make a new ATH on Tuesday the 13th. After that, the action was choppy and sideways, the market making higher lows and lower highs. That is typical for an EWT triangle formation, which would suggest it could be a 4th wave with another 5th needed to take us to ATHs again before a turn.
Coming back to the cycles, we had no new development on the weekly. The resistance triggered on ES was whipsawed, but the market couldn’t break above it with conviction and closed right in its vicinity. YM still didn’t trigger a resistance level, which is something to keep an eye on.

Weekly Cycles

The daily cycles are both in confirmed up impulses now. Normally we would expect them to have regular unwinds, meaning BRs and ENDs before they finish. Reaction to a triggered BR or to the break-out levels in case the market heads there directly, will be telling for the intermediate term direction. Of course right now there is no sign of a turn and the market could continue higher in the mean time. The directionality tool on YM is pegged at the highest level and is getting a bit long in the tooth for a pullback. That would also provide clues of a potential turn once it starts moving.

Daily Cycles

The 288 and 480min cycles    
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MCM Newsletter – Outlook for Week 12 – 16 Dec

After the brief pull-back from 2 weeks ago, last week saw the bulls come back with a vengeance. And they managed a week for the history books, the market closing higher every day in the past week, after opening with a gap up on Monday. Such a relentless push up brought many indicators into overbought territory, the question now being how long can the market stay this overbought before correcting.
The interesting thing is that the weekly cycles triggered a resistance level in the form of an END, which could mark the end of the up impulse. YM didn’t trigger a resistance yet, which could mean that the market can go slightly higher, but the normal expectation is still for the market to at least pause the upside here and start a correction.

Weekly Cycles

Weekly Cycles

The daily cycles decisively broke above resistances and YM is already in an impulse up. ES will confirm the up impulse shortly as well, which is a pretty big warning for shorts. The directionality tool on YM is pegged at the highest level and if it pulls back that would be a clue that a correction might start.

Daily Cycles

Daily Cycles

The 288 and 480min cycles are    
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MCM Newsletter – Outlook for Week 5 – 9 Dec

After the silent grind higher from 2 weeks ago, which had us question whether it was the calm before the storm, last week didn’t bring the storm just yet. But the market did retreat from the high registered the previous Friday. That high was breached though on Monday and Wednesday on ES and also on the cash index on Wednesday. That seems like a typical flat formation (for those EWT inclined), which would mean that at some point the market would need to take out the ATH once again.
Looking at the cycles the weekly still doesn’t show signs that a turn is in. The slight pullback we had last week was not enough to paint a resistance level on the weekly and it also didn’t change the directionality trend which is still going up.

Weekly Cycles

Weekly Cycles

The daily cycles registered an interesting development. A resistance level triggered also on ES which was more respected than the one which triggered on YM a while back. The market pulled back from there and found support at the mcm-MA. The directionality tool on ES started to move down also, while the one on YM is still at the maximum point. So there are signs that the market is approaching exhaustion, but for the exact turning point to be confirmed we need to look at the shorter timeframe cycles.

Daily Cycles

Daily Cycles

The 288 and 480min cycles show    
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