Cycle Trading

The previous intermediate cycle ran long and printed 4 daily cycles. The current intermediate cycle is running long and is in its fourth daily cycle. I believe that this will be the terminal daily cycle to the current intermediate cycle. And I believe that evidence is beginning to surface that supports this view.

The above chart shows us the terminal daily cycle to the previous intermediate cycle and also the current intermediate cycle. I marked the daily cycle lows and labeled the daily cycles: 4th, 1st, 2nd, 3rd, and 4th.

In the next chart i will look at the 4th daily cycle to the previous intermediate cycle and also the 1st daily cycle to the current intermediate cycle. The chart that follows will show the 2nd, 3rd and 4th (current) daily cycles to this intermediate cycle. What we will focus on will be the Selling on Strength numbers.

From the daily cycle low in late April to the intermediate low in June there were a total of 15 selling on strength days. Selling on Strength only prints on a day the market is up. So for the 4th daily cycle of the pervious intermediate cycle there were 28 days that closed positive. So that is 15/28.

Next let’s look at the first daily cycle that merged from the June intermediate low. There were only 6 SOS days our of a possible 27 days, or 7/27.

Now the 2nd daily cycle, that comprised September and part of October, had 4 SOS days out of 16 positive days. That is 4/16.

The third daily cycle stretched from early October into December. There were 6 SOS days out of 25 positive closes which was 6/25.

And so far this 4th daily cycle had 5 SOS days out of 5 positive closes.
That’s 5/5

Summary
4th daily cycle — 15/28 = 53.5 %
1st daily cycle — 7/27 = 25.9%
2nd daily cycle — 4/16 = 25%
3rd daily cycle — 6/25 = 24%
4th daily cycle — 5/5 = 100% (in progress)

Recall that our expectation is to see this daily cycle form as a left translated cycle peaking by day 20.

The evidence is pointing to storm clouds on the horizon …