MCM Newsletter – Outlook for Week 25 – 29 July

Executive Summary:
Main Trend (weekly): neutral
Intermediate Trend (daily): up
Short-Term Trend (480&288min): up
Details:
The market continued the relentless up move, albeit at a slower pace. As mentioned last week a potential break-out and up impulse on the weekly cycles is now on the table, as price moved significantly above resistances. The direction in the next 1-2 weeks will be critical for confirmation (or not) of the up impulse. If the markets travel back down, the back-test of the resistance level became also very important to watch, as it is now support. The bounce started by the directionality tool continued and going forward it will be important to see if it gets to the maximum value or it will be a failed bounce.

Weekly Cycles

Weekly Cycles

Last week a significant development was registered on the daily cycles. A 2nd END resistance was triggered pointing to the continuing unwind of the up impulse. This 2nd phase of the unwind was unusually strong and as a result this sub-wave is a lot bigger than the 1st unwind (1st BR and END). The normal expectation now is for the market to correct until a new support level is triggered which will likely lead to another bounce to a 3rd END and complete unwind of the up impulse.

Daily Cycles

Daily Cycles

The 480 and 288min cycles are both in up impulses. 288 is already in the unwind phase, having had already an END and a following support, so a 2nd END could trigger soon. 480 is in a nested impulse which, even if it confirmed, never really broke out from the vicinity of the resistance, so it could still be reversed directly. It is interesting that the directionality tool on both fell and at the moment is bound at the minimum level which is usually a sign for weakness. Near term it will be important to see if it stays there or it bounces.

288&480min Cycles

288&480min Cycles

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