The Periodical: 21st January 2022
Equity indices slump, crypto crumbles and PMs finally kick higher this week
Chart of the Week
This week has been full of excellent periodic action, most notably in stockmarkets where indices are approaching a 20 week nominal low (at least), due early to mid February. The current phasing we have places one more 20 day component to come but many are at significant FLD support so it will be interesting to watch and report on these next week. Suprisingly the FTSE has held up the most. Given it’s longer term, relatively bearish phasing, this maybe somewhat of an anomaly and price may well catch down to other indices as we approach the larger low. It may well be connected to the bullishness in oil and the representation of those individual issues in the UK index.
Precious metals have accelerated from 20 week nominal lows. Silver has found some spark and is within touching distance of our target at 25.5. Gold is somewhat more patchy but the underlying trend is bullish. Both are near 80 day nominal peaks with the next low due mid February. Uranium, via URA at least, has disappointed with the 20 week nominal low failing to provide any impetus higher. There is a outside chance the 20 week low is infact coming in now but we will explore that in an update next week.
Cryptocurrency has traced out a sorry looking 20 week component since early December. Bitcoin has crossed a significant VTL, indicating a peak of 54 month (4.5 magnitude has recently occurred). This implies sideways to bearish action until the next 18 month nominal low late in 2022. Some relief for bulls will come firstly in early February with the 80 day nominal low and then, more vigourously, at the 40 week low mid April.
Currencies have taken somewhat of a back seat this week, although AUDNZD has very likely started a bullish new 20 week component. The fact price went sideways at the recent 20 week peak is testament to the strong bullish underlying trend. EURGBP has been a messy affair with sporadic price action from the 20 week nominal low. One to sit back and watch for a while. USD pairs are all limbering up to accelerate from large degree cycle lows, some have kicked off already, GBPUSD being one. Keep an eye on EURUSD, it is well overdue some upside acceleration in the coming weeks. The DXY has moved fairly crisply from it’s 80 day nominal low targeting 96, after that we will be looking at shorts into the 40 day nominal low to come late February.
In energy, oil has maintained a bullish stature but is now rolling over in the current 80 day component. The phasing is very similar to equity indices which suggests there may be some more significant downside to come in both. Natural gas has reflected macro concerns (which amplify periodic components) and moved back to the 40 week FLD support. This was after an explosive move upwards from the recent 18 month nominal low. Price is currently around the 40 day nominal low.