Cycle Trading

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The dollar was rejected by the 200 day moving average back in December. It retested it once again late January/early February and was once again rejected. The dollar broke below the 50 day MA and printed a 17 day left translated daily cycle low on February 19th.

The current daily cycle peaked on day 6 and was rejected by the 50 day MA. Tuesday, day 14, saw the dollar being rejected by the declining cycle trend line indicating that the dollar has entered its final descent into a daily cycle low.

I believe that gold has been waiting on the dollar before breaking out of consolidation. Gold appears to have left behind a 20 day right translated daily cycle low on day 20. Confirmation that day 20 was the daily cycle low will arrive with a break to new highs, above 1355.00.

Meanwhile stocks appear to be ready to correct.

Stocks did form a swing high on Monday. Tuesday, day 23, saw stocks pierce the daily cycle trend line today and form a bearish crossover on the True Strength Indicator. If the TSI breaks below the zero line then the chances are good that stocks have entered their daily cycle decline.