A number of analysts are recently looking at the Russell 2000 index when reviewing cycles and market moves. The thinking is the DJIA and SP500 can be manipulated too easily by activity in a few stocks.
With that in mind, following is a daily chart Russell 2000. An index with 2000 stocks becomes less easily manipulated. I've included the 15 and 45 sma.
This is interesting as it shows the probability of May 15th being a Primary cycle low. The 15 dma is below the 45 sma and price is below both, with the 15 sma turning up after the bottom. What's wrong with the chart? The Primary cycle is very short at 14 weeks. The Primary cycle also known as 18 weeks cycle has an average range of 15 - 23 weeks. The Primary cycle started on Feb 5th on the above chart as did the Primary cycle on the following chart for the SP500 (ignore the red and blue dots). The moving averages are the same as is the start date for the Primary cycle at Feb 5, 2014. There is nothing pointing to May 15th as being a Primary cycle low in the SP500 chart below.
The Russell 2000 is telling us we are entering the 4th week of a new Primary cycle. This would typically go up to the 4th to 5th week in a bullish environment. This may still be a good place to buy the Russell. Subscribers will have my buy or sell recommendations for both indexes.
Keep the following quotes in mind as I suspected problems in this time period for some time.
From the May 17th post.
"Also what is coming shortly is Mercury stationary retrograde on June 7 and
Neptune stationary retrograde on June 9. This
seems to indicate a period of lies, deceit and false hoods. Since we already
have all these, perhaps a period of enhanced lies, deceit and false hoods
better sates the case."
From the May 24th post.
"Rather than look at the exact date of the Neptune station I look at the time period from May 28 to June 29 as a window for
activity. Neptune can equate to
issues with water (especially now since it's in Pisces, the sign of it's ruler
ship), oil and gas, charities, spirituality, hospitals and things that are hard
to grasp. Like me. The feeling of being lost or the unknown. In it's highest
form it is the recognition of the spiritual and the lowest, lies, deceit, fraud
and corruption. With the way things are at this time I unfortunately look to
the latter to manifest."
From the May 31st post.
"although beneficial for the arts, music, poetry etc. also stands for illusion and delusion."
Illusion and delusion may turn out to be very fitting for this time period.
What to expect? Mercury and Neptune turning retrograde both have a history of occurring near market turns or CIT's (Change In Trend). There is also a Full Moon late in the week with Venus opposing Saturn on the same day. Not positive for stocks and both are in the "Money Signs", Taurus and Scorpio.
From our earlier analysis the SP500 is in the 18th week of it's Primary cycle, and due for a turn, while the Russell 2000 may be about to enter the 4th week of a new Primary cycle. That said, an old saying is don't fight the FED. Their dovish monetary policy is undoubtedly responsible for these market moves, although late last week looked like a short covering rally.
I'm expecting increased volatility over the next couple of weeks and the possibility of a resolution to the status of the SP500 and DJIA.
As I write this post things seem to be a little quieter on the world stage. At least there seems to be less things being blown up and less blood being spilled, at least there has been less reporting on the above. Astrological signatures coming up will probably change this once again. Mars squares Pluto on June 15th and is forming a T-square with Pluto and Uranus. Although not exact it should be close enough to stir up war like activities, bad weather or geophysical problems. This should be from June 14th on for a few weeks with an emphasis on June 25 +-.
Gold may have just put in a Primary cycle low on June 3rd. It's a little early to confirm as I would want to see this rise off the bottom. If this isn't the Primary low then we are in the 23rd week of an older Primary cycle. The timing is right and so are the 15 and 45 day sma's vs price.
Gold is entering a period where it usually becomes very volatile. Heliocentric Mercury will be entering Sagittarius on June 9th through June 20th. I'm looking at this as a good trading opportunity both up and down. Subscribers will have the dates.
Keep in mind I'm looking at this as a short term opportunity while the 2nd half of 2014 should yield a very strong move in precious metals.
Seasonally this is a weak period for crude. Unlike Gold, Crude has not defined whether we are at the end of a Primary cycle (22nd week) or we just had the crest of the first Major cycle (6 week) and we are headed down to a trough. The latter assumes May 1st was a Primary cycle low. It was 15 weeks along but difficult to confirm. If it was, it wasn't very deep. Watch crude closely. We want to see price below the 15 sma and 45 sma.
Other things to watch.
Neptune is active. Neptune
rules Crude and NatGas. There are many issues surrounding both here and in Europe. Russia
continues to negotiate with the Ukraine
over gas contracts. This should continue most of the month.
Coffee has just bounced off the 50% retracement of the move up from Jan 27, 2014 to April 24, 2014 and is sitting on the
price line. This area is an old support line now turned into resistance. If it
breaks through the Neptune price line it could
From the last post
"I use the date of Aug 15, 1971 for the
This is the date Nixon took the US
off the gold standard. Based on this chart watch the US $ from June 4-6 for either a
significant issue and at the least a big range day. June 6th seems to be the
most exact. Transiting Mars will be conjunct natal Uranus on this chart.
Looking at mundane events that could be the trigger, the ECB meets on June 5th." US
June 5th was a very big range day for the