Cycle Trading

The declining cycle trend line rejected the dollar on day 16.

The current daily cycle features a day 3 peak and has broke below the previous daily cycle low causing it to be a failed daily cycle.

Failed daily cycles are characteristic of an intermediate cycle in decline.

The dollar will enter the timing band for a daily cycle low next week and could find a low anytime over the next two weeks.

Intermediate cycle enters next week with a break of the cycle trend line already in hand.

Next week will be week 15 and that is the beginning of the timing band to print a low.

Since the weekly cycle can stretch to 23 weeks, there is a possibility that the dollar could print one more daily cycle in the current weekly cycle.

The yearly dollar cycle is now in month 6.

Currently the yearly cycle has a peak in July, month 5, with August currently showing a lower high.
As previously stated, the current intermediate cycle enters its timing band for a low next week.
If the current intermediate cycle prints a right translated weekly cycle, then the new intermediate cycle will likely print a higher high.
Which means the yearly cycle will likely break out to a new high.

The red trend line is something that I am watching. A breach of that line could signal a decline into the three year low.

Stocks

Friday was day 13 for the equity daily cycle.

There is a current daily cycle peak at day 10 and equities appear to be consolidating their recent gains. Should the dollar make one more push lower, we could see equities break out to a new high which would be congruent with what we see on the weekly cycle.

The weekly cycle printed week 9.
The current weekly cycle follows a right translated intermediate cycle.
Therefore the expectation is for the current weekly cycle to print a higher weekly high. In order to do that stocks need to break above the declining cycle trend line which they did this past week.

That break above the declining trend line may have signaled a new yearly cycle.

A monthly swing low formed with June being the yearly low (so far).

Over the past 15 years, equities have had only one yearly cycle printing at 8 months. So it is possible that August just maybe month 1 of the new yearly cycle.

However, June may have only set a yearly cycle trend line,

I say this because of the divergence in momentum that I see in the NYAD

Even though the NYAD has broken out to new highs, there is a divergence in momentum.
Also consider that the dollar is in the process of seeking out its intermediate cycle low. Once printed, the dollar should rally strongly into a new IC which will likely send equities seeking out their intermediate cycle low.
So I am keeping an open mind to this scenario.

Gold

Friday was day 14 for gold’s daily cycle.

After the break out from the triangle consolidation, gold back tested the break out.
Gold will need to break above 1630 to confirm the break out and lock in a right translated daily cycle.

We are also waiting on gold to break above 1630 to form a weekly swing low to confirm a new intermediate cycle.

May is beginning to look more and more like the yearly cycle low.

Gold would need to break above 1664 to form a monthly swing low which would mean August is month 3 of the new yearly cycle.

Miners

Friday saw the Miners print a new daily cycle high at day 13.

A day 13 high shifts the odds of the current daily cycle forming as right translated.
Day 16 begins the timing band for printing a low.
We will likely see the miners form a swing high in conjunction with the dollar forming a swing low.

Remember how we are waiting on gold to confirm a new intermediate cycle?
Well it looks like the Miners did that this week.

Just as gold appears to have had a shortened intermediate cycle, so do the Miners.
The difference is that that Miners have a swing low and a trend line break in hand.
So the Miners seem to be leading gold out of the intermediate cycle low.

The Miners also broke through the accelerated declining trend line.
This is another check off for confirming a new three year cycle for the Miners.

The yearly Miners cycle shows that the HUI is coiling on a monthly basis.
This is not unusual for an asset to from a coil after halting a three year cycle sell off.

We still need to see the Miners break above the declining trend line to confirm a new three year cycle.

The CRB Index

Friday was day 6 for the CRB

The CRB formed a swing high on Friday.

We will need to wait and see if this is setting the daily cycle trend line or not.

The weekly CRB stands at week 7.
The CRB did pierce the declining three year cycle trend line.
We will need to see some follow through in order to be confidant that this was not a false break out.

We also see the CRB piercing the three year cycle declining trend line on the yearly cycle.

Just like the weekly cycle, more follow through is needed to declare a new yearly cycle.

Bonds

TLT printed a reversal on Thursday and formed a swing low on Friday, day 16.

TLT entered the timing band for printing a daily cycle low last Thursday.
TLT will need to break above the declining cycle trend line to confirm a new daily cycle began on Friday.

The weekly cycle also looks to have printed a cycle low.

Last week was week 20 for the intermediate cycle and are in the timing band for printing an intermediate cycle low.

TLT tested the October pivot and left behind a reversal candle.
A break above 128.14 forms a swing low and will likely mark the intermediate cycle low.

Since the current intermediate cycle appears to have locked up a right translated formation, we can expect the next intermediate cycle to print a higher high.

The expectation of a new intermediate cycle beginning soon would suggest that the yearly cycle is still printing higher monthly highs.

Office memo:
I will be out of the office next week and do not expect to post a report until the weekend.

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