Cycle Trading

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The dollar broke above the declining trend line in a clear and convincing fashion today signaling a new daily cycle.

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Over the past 3 -4 weeks the dollar has done a masterful job obscuring its daily cycle count. However, today clears things up. The trend line break signals that day 23 was a daily cycle low and makes Tuesday a 21 day, right translated daily cycle low.

And since stocks and the dollar have recently been in lockstep, I believe that this also signals a new daily equity cycle.

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Tuesday was the lowest point following the day 36 peak. A break above Tuesday’s high of 2016.89 forms a swing low. With Tuesday being in the latter part of the daily cycle timing band, a swing low will likely mean a new daily cycle. A break above the declining trend line confirms a new daily cycle. Following a right translated cycle we expect to see this new daily cycle print a higher daily cycle high

And now a little follow up to last night’s post.

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The RSX delivered a clear and convincing swing low on over 6 times the average 200 day volume to signal a new daily cycle. A break of the declining trend line confirms a new daily cycle.