Cycle Trading

The dollar formed a swing low and broke the declining trend line to confirm a new daily cycle.

The dollar left behind a left translated failed daily cycle. If the dollar is still in an intermediate cycle decline then this new daily cycle should form in a left translated manner peaking on or before day 8.

Stocks managed to post a gain with the dollar rallying. Thursday was day 10 for the daily equity cycle. Despite the positive gain for the day, stocks still could not break above the resistance zone the stretches back to mid-December. I still suspect that stocks will pullback further in order to regroup to break out to new all time highs. There was a mild 28 million Selling on Strength day today that suggests more weakness. A pull back to the 50 day MA is a possibility here. Stocks could also fill the gap left behind at the 1775 level.

The Miners negated the swing high formed yesterday by breaking out to a new daily cycle high today. Thursday was day 16 for the daily Miner cycle. Printing a new high on day 16 begins to shift the likelihood that this daily cycle will form in a right translated manner. The True Strength Indicator is beginning to roll over alerting us to be on watch for a daily cycle decline. A swing high accompanied with a trend break confirms a daily cycle decline.