Cycle Trading

The dollar printed a swing high today. If this develops some follow through and marks the cycle peak, then forming a left translated cycle is still on the table. What we need to watch is if this daily cycle fails, by breaking below the previous daily cycle low. A failed daily cycle signals that the dollar is still in its intermediate cycle decline.

However, if this is just a pause before moving higher and the dollar forms a right translated daily cycle, then that confirms a new intermediate cycle.

Gold gave back all of its gains from Tuesday.

On Wednesday gold had an inside day, printing neither a higher high nor a lower low. So we have no confirmation if the daily cycle is extending or beginning a new daily cycle.

The Miners are in a similar set up.

After the low that they printed on Friday the Miners have traded sideways and have not formed a swing low. And like gold, we have no confirmation if the daily cycle is extending or beginning a new daily cycle.

Both gold and the Miners could be on day 19, which leaves time for another push lower.

Stocks finally gave the appearance of leaving behind a daily cycle low.

After printing a low last Thursday stocks have drifted higher, but closed in the lower half of its daily candle. Wednesday saw stocks print a .81% gain and closed in the upper part of the today candle. Stocks also broke above the accelerated (dashed) declining trend line, which is another signal of a new daily cycle. A break above the declining (solid) trend line confirms a new daily cycle.

However, I think that the Big Boys will sell into this rally to leaving the little guys holding the bag …

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