Cycle Trading

The Dollar

Thursday’s swing high & Friday’s bearish follow through signals that the daily cycle decline has begun.

Friday was day 18 for the daily dollar cycle. The dollar has closed below both the daily cycle trend line and the 10 day MA to confirm the daily cycle decline. However, the dollar is in a daily uptrend. It will remain in its uptrend unless it closes below the lower daily cycle band.

Stocks

While 23 days is normally too short for a DCL, it is looking more & more like day 23 did host the DCL.

Our rationale to label day 23 as the DCL includes:
* Swing Low off of support at the 200 day MA
* Closed above the 10 day MA
* Closed above the declining trend line.
* Delivered a bullish TSI Zero Line Crossover

Additional evidence:

* Stocks closed above the 50 day MA
* Stocks have begun to turn the 10 DMA higher
* Closing above the upper daily cycle band.
* Apparent change of nature.

There was more volatility as stocks emerged from the previous day 34 DCL. And stocks were also unable to close above the upper daily cycle band. The rally out of the day 23 low has been stronger. And closing above the upper daily cycle band ends the daily downtrend and begins a daily uptrend.

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