Cycle Trading

The dollar formed a swing low Today. That sets up the possibility of today being day one of a new daily cycle.

Friday was day 16 for the daily dollar cycle. That is two days shy of the normal timing band for a daily cycle low. A 16 day cycle is not without precedent. Still we would like to see a clear and convincing break of the declining trend line will signal a new daily cycle.

The daily equity cycle extended its rally setting another new all-time high.

Monday was day 13 for the daily equity cycle. While stocks are at an all time high we see a bearish divergence developing on the True Strength Indicator. Also the last three times the Money Flow Index tagged the 80 level and turned lower and was accompanied with a bearish TSI crossover, stocks declined into a cycle low.

The Money Flow Index tagged the 80 level today. A bearish crossover on the True Strength Indicator sets up the possibility of a impending cycle decline.