Cycle Trading

The dollar found support off the 200 day MA on Thursday.

Thursday was day 14 for the dollar’s daily cycle. If the dollar was in its timing band for a daily cycle low then we would expect that the 200 day MA would trigger the DCL. But the dollar should have 2 to 3 more weeks before it prints its daily cycle low. The peak on day 9 sets up the expectation for a left translated daily cycle formation, which aligns with the dollar being in a daily downtrend. The gravitational pull from the pending intermediate cycle low should cause the dollar break below the previous daily cycle low of 94.64 in order to complete its daily cycle decline.

The dollar has already confirmed that it is declining into its intermediate cycle low. The dollar printed its lowest point week 16, following the week 8 peak. But 16 weeks is too early to expect an intermediate cycle low. Last week the dollar was rejected by the 10 week MA which indicates a continuation of the intermediate cycle decline. Allowing 2 to 3 weeks for the completion of the current daily cycle will bring the dollar into its timing band for an intermediate cycle low. And since the cycle low is the lowest point following the cycle peak, then the dollar should break below the week 16 low of 94.64 in order to complete its intermediate cycle decline.

And in the Weekend Report I will explain why I think the dollar will continue lower to break below the September low of 93.39.