Cycle Trading

While Greece dominated the news today, it did not further our analysis of the daily equity cycle.

One scenario has last Tuesday as being day day 15 which would make today day 18. That would leave 2 to 3 more weeks before a daily cycle low is expected to print. So, breaking below last Tuesday’s low would align with this scenario.

A second scenario makes last Tuesday day 37 which would be in the timing band for a daily cycle low, making today potentially day 3. A declining trend line break aligns with this scenario.

But what I feel is newsworthy tonight is looking at the CRB.

The CRB was rejected by the 50 day MA on Friday, which was day 8. Monday the CRB gapped lower, delivering a clear and convincing break below the daily cycle trend line and the previous daily cycle low to confirm a failed daily cycle. With Monday being only day 9, we could see the CRB trend lower for the next 2 to 4 weeks.

Of course a failed daily cycle confirms the intermediate cycle decline.

Today’s break lower delivered a clear and convincing break of the intermediate trend line providing additional confirmation of the intermediate cycle decline. With a peak on week 7 the CRB has locked in a left translated nature to this weekly cycle. A left translated formation typically forms a lower low. So we should see this weekly cycle break below the previous weekly low of 206.81, printing a failed intermediate cycle.