The 2 February high was the peak of both the 20 week and 80 day cycles. The next 80 day cycle trough is due this week and a likely stopping place is the blue line, the 80 day FLD circa $1400. At which point the expectation is for a new 80 day cycle to commence.
The FLD is a replica cycle pushed forward in time and when price looks to intersect with it at a trough zone we expect it to act as resistance.
We have to bear in mind that because we have just had a 20 week cycle peak (meaning this longer cycle is now falling) that there is a bearish burden on the next 80 day cycle. We are expecting a bounce but it should be running into a headwind.
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