Cycle Trading

The Dollar

The dollar printed its lowest point on Monday, day 30. A swing low formed on Tuesday, setting up a possible daily cycle low.

Monday was day 30, placing the dollar deep in its timing band for a daily cycle low. The dollar needs to break above the declining trend line to confirm a day 30 DCL. However, if the dollar breaks below the day 30 low of 92.43, that will extend the daily cycle decline.

Stocks

Stocks got a bit stretched above the 10 day MA after emerging from its daily cycle low.

Friday’s volatility caused stocks to back test the 10 day MA.

The large Buying on Weakness number indicates that Friday was a half cycle low. A swing low here will allow us to construct the daily cycle trend line. Stocks continue to close above the upper daily cycle band, indicating a daily uptrend. They will remain in their uptrend unless they close below the lower daily cycle band.