Anyway, the current haly-daily cycle is on day 16 and daily cycle on day 32. Both cycles are due for a decline in the next 5 to 8 trading days. I started to incorporate some indicators into my tarding arsenal. I've been studying several over past month or so and found stochastic(5) to be the most reliable momentum oscilator and Money Flow Index MFI(5) as the most reliable accumulation/distribution indicator. Both are just screaming for a decline. In fact, I haven't seen MFI so strongly overbought since the last bull market. A correction is due, but both indicators show strength in the market. Decline might materialize only as a 2-3 day swift drop and then quickly reach new highs. The next weekly low is still at least a month away, so there is plenty of time for another new highs attempt. However, I definitely don't want to buy anything right now. Stock market will correct very soon and shake out many week hands who are buying these "breakouts".
Now on to gold. I use the exact same indicators. Gold also exhibits strength. The half-daily cycle, that usually takes 7 to 9 days, bottomed surprisingly in just six days and and gold is now flirting with 1675 resistance. It wont be breached in the first attempt, I'm almost sure about that. I expect gold will decline in the daily low sometimes in early February within the next two half-daily cycles and everything suggests it should make a significant higher high. I plan to buy the next daily low for a short term trade if MFI bottoms above 20, which would mean a lack of distribuion. However, the next daily low after this should also be a weekly low, which means that gold will probably come down to retest the 1525 area. The next weekly low should also provide the best long term buying opportunity of this bull cycle for another couple of years.
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