Cycle Trading

Gold closed loser on Tuesday.

Gold broke below the previous daily cycle low to form a failed daily cycle which confirms the intermediate cycle decline. Tuesday was day 29 for the daily gold cycle, placing it in its timing band for a daily cycle low. At this point a swing low accompanied by a close above the 10 day MA would signal a new daily cycle.

Instead of following gold lower, the Miners demonstrated some bullish divergence by closing higher on Tuesday

Tuesday was also day 29 for the daily Miner cycle. The Miners printed a bullish reversal off of support of the 50 day MA. That eases the parameters for forming a daily swing low. A break above 22.37 forms a swing low to signal a new daily cycle.

This sets up a low risk opportunity for the Miners. The Miners are getting deep in their timing band to print a daily cycle low. That increases the odds that a swing low will mark the daily cycle low. So if the Miners do form a swing low, a stop could be placed just below the 50 day MA.