Cycle Trading

Stocks sold off for the third consecutive day.
And for the third consecutive day stocks delivered a bullish Buying on Weakness signal .

Stocks printed 163 million for Buying on Weakness today. Combine that with the 1.623 billion BOW from the previous two days totals over 1.78 billion Buying on Weakness.

Today was day 20 for the daily equity cycle. Even though stocks have sold off for three straight days, stocks are still above the daily cycle trend line. Last night Bob commented that the BOW numbers can “actually be interpreted as “If even such large buying pressure can’t lift price, then we are REALLY in trouble on the downside” Bob’s comment may prove to be prescient if stocks fail to rally here and break below the daily cycle trend line. Should that happen that would lock in a left translated cycle formation setting up an expectation for a failed daily cycle.

The Miners delivered a bearish Selling on Strength signal today.

The Miners printed 217 for Selling on Strength today.

The Miners have formed a swing low off the day 25 low. But 7 days later they still have not confirmed a new daily cycle. And the large SOS number suggests that a break lower is still in the cards for the Miners.