Cycle Trading

I like to begin by looking at how cycle bands help to identify trends.

Back in January of 2016 and October of 2016 stocks closed below the lower daily cycle band. Closing below the lower daily cycle band ended the daily uptrend and began a daily downtrend. Generally speaking a close below the lower daily cycle band is another indication that the cycle is declining into an intermediate cycle low.

Then in March of 2016, November of 2016 , and April of 2017 stocks began to close back above the upper daily cycle band. Closing above the upper daily cycle band signaled a new daily uptrend. Notice how once stocks are in a daily uptrend, they remain in their daily uptrend until the close back below the lower daily cycle band.

Currently we can see that stocks formed a swing low & closed above the declining trend line on Wednesday to confirm that day 29 hosted an early DCL. Stocks also closed back above the upper daily cycle band resuming their daily uptrend. Stocks are in a daily uptrend & will continue in their uptrend until they close below the lower daily cycle band.