Cycle Trading

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Stocks delivered an eye-popping Selling on Strength print today.

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The 852 million S.O.S. is a big number. It is more like the type of number we see as we near an intermediate top.

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Stocks managed to print a higher daily cycle high today. At day 28 stocks are two days shy of entering the timing band to print a daily cycle low. Today’s S.O.S. suggests that we could see a strong move lower. But since a right translated daily cycle is virtually assured, we can expect to see a higher daily cycle low form and then the next daily cycle go on to print a higher daily cycle high.

The dollar also closed at a new daily cycle high today.

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A day 14 peak locks in a right translated nature to this daily cycle. Our framework has identified the May pivot as the 3 year cycle low. We are still awaiting confirmation of this. However, if the May pivot was the three year cycle low, then this triangle consolidation should resolve bullishly.