SPX, TNX are Challenging their Cycle BottomsStock-Markets / Stock Markets 2016 Jan 11, 2016 - 01:55 PM GMT
The SPX Premarket is higher but not critically so. There are five waves down from the underside of the 4.25 year trendline, but the middle wave is the shortest, suggesting a correction is underway and not the fifth wave. So we may expect a sharp, but short sub-Minute Wave (c) to resistance at the Cycle Bottom at 1954.03.
This may be due from a liquidity spike from USD/JPY which went as low as 116.69 on Friday, nearly matching the August 24 low at 115.45. It cdoes not appear to be sustainable.
We can also see that SPX is challenging its Cycle Bottom at 2030.67. It Closed Friday beneath it, so it may attempt to overcome it this morning. However, the trading bands are somewhat elastic and I wouldn’t be surprised to see SPX below the band again later today.
TNX is facing the same challenge at its two-hour Cycle Bottom. However, the decline does not appear to be in jeopardy, since there is already an impulse completed to the trading band on Friday. Admittedly, it may go as high as its next cluster of resistance at 22.31, but we’ll simply have to monitor for a reversal back below the Cycle bottom at 21.46.
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