Cycle Trading

Stocks formed a swing low on Monday.

Stocks printed their lowest point on Thursday, day 29. After a narrow range day on Friday stocks rallied enough on Monday to recover all of Thursday’s drop. That and the fact that stocks also formed a daily swing low convinces me that the daily cycle low has been set. A close back above the upper daily cycle band will confirm the new daily cycle.

Oil confirmed its daily cycle decline on Monday.

The daily oil cycle peaked on day 27. It did not manage to form a daily swing high until Friday, day 35. Oil broke below the daily cycle trend line on Monday to confirm that oil is in its daily cycle decline. Monday was day 36, placing oil in its timing band for a daily cycle low. If a swing low forms now, it has good odds of forming the daily cycle low. Oil is currently in a daily uptrend. If the daily cycle low forms above the lower daily cycle band then oil will remain in its daily uptrend.