Cycle Trading

Stocks delivered a warning signal on Thursday.

Stocks broke below the daily cycle trend line on Thursday. With a peak on day 4, this is setting up to be an extremely bearish left translated daily cycle. A close below the upper daily cycle band will confirm the daily cycle is in decline. A break below the previous daily cycle low of 2233.62 will form a failed daily cycle and confirm that the intermediate cycle is in decline. This aligns with what we were discussing on January 10th.

Gold also delivered a waring signal on Thursday.

Gold formed a daily swing high on Thursday. At 22 days gold is in its timing band to seek out a daily cycle low. Gold will need to break below the daily cycle trend line to confirm that the daily cycle is in decline. A peak on day 20 indicates a right translated daily cycle formation. With gold emerging from a yearly cycle low our expectation is once a daily cycle low forms that the new daily cycle goes on to print a higher high.