Cycle Trading

The dollar’s daily cycle peaked on Thursday and formed a swing high on Friday day 18.

The dollar has just entered its timing band to seek out its daily cycle low. The timing band calls for the dollar to find its low in the next two weeks.
The dollar did breach the accelerated cycle trend line (red) adding a level of confidence that this does mark the daily cycle decline.

Since the peak formed on day 17, there are very good odds that this cycle will result in a right translated daily cycle with the daily cycle low printing above the previous daily cycle low. The expectation for the next daily cycle is to print a higher high following a right translated daily cycle.

The weekly cycle stands at week 10.

The current daily cycle’s timing band suggests a low will be printed in the next two weeks. That could take the dollar out to week 12. Add in one more daily cycle and that would bring the dollar’s intermediate cycle out to week 18 or 19.

So while the expectation is for the next daily cycle to print a higher high, the projected timing of the next daily cycle low brings the dollar to the threshold of the timing band for an intermediate cycle low.
Therefore the next daily cycle could print a higher high and then form as left translated and printing a lower low. Left translated daily cycles peak before day 12, often by day 8.

The yearly cycle has the dollar at month 5.

The dollar’s yearly cycle printed a higher high in July. The next daily cycle should find its low in August. With the expectation of the next daily cycle printing as a left translated failed daily cycle, then August could form a monthly swing high off the July peak.

That would set the table for a decline into a yearly cycle low right around the time when gold is seasonally very bullish.

And now lets take a look at some long term trend lines.

The three long term trend lines to jump out to me as interesting are:
— The 10 year declining trend line
— The 20 year support/resistance trend line
— The trend line off the 2008 low.

So lets take a closer look.

It is interesting to note how the trend line from the 2008 low intersected with the current three year cycle trend line (red) resulted with an explosion out of the yearly cycle low in May slicing through the declining ten year trend line.
The 20 year support/resistance trend line has (so far) kept a lid on the current rally.

The dollar here could break above the 20 year support/resistance trend line during the next daily cycle. The trend line to watch here is the current three year trend line (red).

If the conclusion of the current intermediate cycle breaks below this red trend line, that would signal the decline into the dollar’s three year low.

Stocks

Equities appear to have printed a daily cycle low on Thursday, day 27.
That low clearly breached the daily cycle trend line.

A swing low and a break above the declining cycle trend line formed declaring Friday as day 1 of the new daily cycle.

The dollar declining into a daily cycle low over the next two weeks should help equities rally during this first leg up, before declining into a half cycle low.

The weekly cycle stands currently at week 5.

The weekly cycle is progressing along a well defined cycle trend line.

Equities are poised to make a run at the 1400 level considering that the dollar’s daily cycle decline should provide a tail wind.

The equity yearly cycle looks to have printed a yearly cycle low in June.

July has formed a swing low off the June low.
A break above the red declining trend line will confirm a new yearly cycle.

I will post part two later in the weekend, so …