Cycle Trading

After gaining more the 1.2% on Friday, the dollar failed to deliver any bullish follow through on Monday.

Monday was day 17 for the dollar’s daily cycle. The dollar is 1 day shy of entering its timing band for a daily cycle low. While the dollar has broke out to a new intermediate high on Friday, there is a bearish TSI divergence developing which signals that a correction is around the corner.

It appears that the Miners may be sniffing out a correction on the dollar.

Monday was day 28 for the daily Miner cycle. The bullish reversal that printed today has eased the parameters for forming a daily cycle low. A break above 13.84 forms a swing low. And since the Miners are deep in their timing band to print a daily cycle low, a swing low will likely mark the daily cycle low.

Stocks formed a swing high and delivered a trend line break last week to signal its daily cycle decline. Stocks continued lower on Monday. Today was day 29 for the daily equity cycle, placing stocks 1 day away from entering their timing band for a daily cycle low. A close below the upper daily cycle band will confirm the daily cycle decline. If stocks can manage to print a daily cycle low above the lower daily cycle band, then stocks will remain in a daily uptrend.