Once again equities reached a new all time high.
The daily equity cycle put in a half cycle peak on day 20 and then drifted into a half cycle low last Friday. The break out to new highs today, day 27, virtually locks in a right translated nature to this daily cycle. And also sets an expectation for the next daily cycle to print a higher high.
Looking at the weekly picture we see that this is week five of the intermediate cycle. This is the third intermediate cycle of the year. It is very likely that this intermediate cycle will result in equities declining into a yearly cycle low.
A failed daily cycle is necessary in order for the yearly cycle decline to commence. With a 27 day count on the current daily cycle, the earliest I would expect to get a failed daily cycle would be the next daily cycle. This is something we will keep on eye on going forward.
The dollar began a new daily cycle today.
As we discussed this morning, recognizing July 11 as a 16 day daily cycle low helped to clarify the declining cycle trend line. With the dollar forming a swing low today, we have a clear and convincing declining trend line break confirming today as day 1 of a new daily cycle.
And if I am right that July 11 marked a daily cycle low, then the dollar just left behind a 14 day failed daily cycle. That signals that the intermediate cycle is in decline setting up the expectation of left translated daily cycles for the remainder of the weekly cycle. We will know if that is the correct cycle count if the current dollar cycle peaks by day 8 because most left translated dollar cycles peak by day 8.
We see that gold continued its cycle decline as the dollar rallied.
Gold’s daily cycle peaked last Wednesday, day 17 and has drifted lower since. Thursday was day 23 for the daily gold cycle. Gold is in its timing band for a daily cycle low. Since Thursday did not print a lower low, I suspect that we will see gold decline at least for another day. So far gold has held above the 1300 level during this daly cycle decline. I suspect that a break of the 1300 level would shake loose a few weak hands and draw in some bears as well.
Although it would be a bullish sign for gold to print a daily cycle low prior to a dollar peak, gold may wait until the dollar cycle peaks before printing a cycle low.
And assuming that gold prints a higher daily cycle low, this will be a golden opportunity …
Cycle Trading 
Leave a reply to rlmsix Cancel reply