Cycle Trading

Stocks formed a swing low on last Wednesday then closed above the upper daily cycle band on Thursday to confirm the new daily cycle. Stocks have given back over 1.5% since Thursday’s intra-day high

Stocks have pulled back the last 2 days and closed just above the lower daily cycle band. A close below the lower daily cycle band would be a bearish development that would signal that stocks have begun their daily cycle decline. But despite the 2 day pull back stocks delivered a bullish signal by printing over 1.6 billion Buying on Weakness printed on Monday

Often stocks will print 600 – 800 million buying on weakness over several days as a daily cycle low approaches. And that usually signals that the daily cycle low is near. If a daily swing low can form above the lower daily cycle band that would set up a potential early half cycle low. And also set stocks up for a bullish end of the year rally.