Stocks & Silver Signaling Multi-Month Lows; Buy Signals Triggered in Both!
03/18/20 Weekly Re-Lay Alert – The Week for a Low… in Stocks & Silver: “Stock Indices spiked lower today, with the S+P 500 & Nasdaq 100 futures continuing to hold above Friday’s lows – never closing below them. All the indices are repeatedly attacking their extreme downside targets for March 2020 (the monthly HLS) – at 19,989/DJIA, 2360/ESM, 6975/NQM & 6895/DJTA.
These are decisive price levels that represent extremes on a higher-magnitude basis. They are being attacked in the week after all three indexes spiked down to (and held) their weekly HLS levels and within days of when the indexes plunged to their daily HLS levels – all warning of an imminent (1 – 2 week or longer) bottom in the mid-month period.
By dropping to new multi-year lows in the second half of March ‘20, the indexes have also mimicked what occurred in Feb./March 1980 – another affirmation of the 40-Year Cycle.
(In 2018, the DJIA set its lowest daily close on March 23 – completing a ~4-week drop. With the 2-Year Cycle continuing to project intriguing parallels, the primary indexes have set low daily closes in recent days – after completing similar ~4-week declines.)
Reinforcing the potential for (at least) a 1 – 3 week bottom, the primary indexes completed a full weekly trend reversal last week. That is a lagging/confirming indicator that is often triggered at the same time an initial low is forming. In a majority of cases, that low takes hold in the ensuing week. That is this week.
However, it would take daily closes above the March 12/13 highs – 23,186/DJIA, 2762/ESM & 8095/NQM – to signal that at least a 3 – 5 day rebound is unfolding.
In normal circumstances (which this is obviously not), the indexes would rally back to the new weekly trend points and/or their now-descending weekly 21 Low MACs… once an initial low is confirmed. Those levels are spread apart with the initial upside targets coming into play at 24,680 – 25,000/DJIA, 2850 – 2910/ESM & 8300 – 8500/NQM.
The last of these – 8300 – 8500/NQM – is the one case where those two indicators are close together and it would represent a 50% rebound of the entire decline. It is also just below this week’s LHR – an extreme upside target that would stretch into next week.
So, at least this gives some parameters for an initial rally if/when it is triggered.
As is often the case in a market like this, that rally could unfold over the next week or two… or be done in 1 – 2 days. If it is the latter of those two cases, that does NOT mean stocks would immediately head to new lows. It would just mean this initial surge would be complete. From there, a pullback and second rally would be possible – but that will hinge on a couple key indicators.
While the futures markets are way too risky for picking a bottom, the convergence of all these factors provides the first time since the peak when enough cycles and indicators are arguing for a bounce and worth heeding.
As a result, equity investors could be re-entering the market on a limited basis here, risking a weekly close below last week’s low (but only if able to bear the risk at this point in the market)…
And, on a much larger basis, a low in March 2020 would provide some important symmetry to the past decade in the overall metals complex…
Precious metals went through a topping phase in late-2010 – late-2011 with Gold providing the final peak in Sept. 2011. The complex then plunged into Dec. 2015 – setting a multi-year low. That 51-month decline sets the stage for a divergent bottom in Silver – the weakest of the metals – in March 2020 – 51 months later (51-month high-low-(low) Cycle Progression).
With Silver trading around 12.00/SI (setting its lowest daily close today, below 11.80/SIK), it is the lowest level since March 2009 and could be time for a major low. Similar to equity markets, this is a good time for longer-term traders and investors to begin buying Silver or related stocks (futures are too risky as this point) while risking a weekly close below 11.00/SIK (use the futures as the trigger point for the risk on this metals’ position).
The XAU fulfilled the potential for a sharp drop into March 12 – 16 – the latest phase of a ~60-degree/ ~2-month low (Sept. 13/16) – low (Nov. 12) – low (Jan. 14) – (low) Cycle Progression. It tested its monthly HLS (extreme downside target) and briefly spiked down to 6 – 12 month support at 66.00/XAU. That should prompt a rally to [see current publications for ongoing analysis & trading strategy updates]”
Stocks fulfill 3 – 5 week sell signals triggered on Feb. 7 – 14; Completing projected overall plunge into late-March ’20 – when a multi-month bottom is expected. Gold & Gold stocks concur, triggering buy signals at same time as oil stocks and overall equities. Silver signals major bottom!
40-Year Cycle and 2-Year Cycle could trigger spike low in DJIA on March 23 – 27, 2020 – the precise time that index bottomed in 2018 AND 1980.
Will Silver, Stocks & Oil Rally Together?
Refer to latest Weekly Re-Lay & INSIIDE Track publications for additional details and/or related trading strategies.