Cycle Trading

It looks like the markets are ready to ring in the new year.

Stocks started out printing a lower low today over the uncertainty regarding the fiscal cliff.
Once word got out that lawmakers in Washington were close to a resolution the markets responded.

Equities looks to have printed an early daily cycle low today.

Since they printed a lower low, the earliest a swing low could form will be on Wednesday.
But with stocks closing at the highs of the day, that has eased the parameters for forming a swing low.

Gold also seems to be ringing in the new year.

Gold closed up .94% higher today and closing above the 1670 resistance.
Gold has already formed a daily swing low,
but we are still waiting on a break of the declining cycle trend line to confirm a new daily cycle.

Based on what we witnessed on the Miners, that may be near at hand.

The Miners looked to have printed a daily cycle low on Thursday, 12/20
A daily sing low formed the next day, but we were waiting on a declining cycle trend line break to confirm a new daily cycle. Today we received confirmation of the new daily cycle. There was also bullish development on the weekly cycle.

The Miners looked as though an intermediate cycle low formed 2 weeks ago.
Today we received initial confirmation with the formation of a weekly swing low.

Now we would like to see a break of the declining weekly trend line to confirm, but with confirmation of a new daily cycle along with being deep in the timing band for a weekly low, that odds are pretty good that a new intermediate cycle began as well.

Today’s action also has caused me to revise my cycle count for the CCI.

The CCI has been involved in a stretched daily cycle that last printed a daily cycle low in November.
That November DCL was a failed daily cycle.
With the CCI breaking below the November low, that makes to failed daily cycles in a row.

That will cause me to revise my weekly cycle count.

I originally thought that November marked an intermediate cycle low.
Since a new intermediate cycle cannot begin with a failed daily cycle, we need to extend the intermediate cycle out.
So the intermediate cycle now stands at week 30.

Getting back to the daily CCI cycle. If the CCI breaks above 557.37 it will form a daily swing low

With both the daily and weekly cycles for the CCI being this stretched, a daily swing low will likely mark both a new daily cycle and new intermediate cycle …

… giving us another reason to celebrate the new year…