Cycle Trading

Stocks closed lower once again. But I am starting to see signals of an impending daily cycle low.

The large Buying on Weakness number and the bullish divergence on the True Strength Indicator are 2 signs signaling that the daily cycle low is imminent. The reversal into the close has eased the parameters for forming a daily swing low. A break above 2044.21 will form a daily swing low which at this point will likely mark the daily cycle low.

If a swing low forms tomorrow, then stocks would have remained above the lower daily cycle band. Which means that stocks would remain in a daily uptrend.

And on the weekly chart stocks are approaching Intermediate Support.

Stocks peaked on week 10 and have formed a weekly swing high. The daily cycle decline has stocks testing the 50 week MA. If a daily cycle low forms here that will allow stocks to remain above the 50 week MA. It would also set the intermediate cycle trend line.