Cycle Trading

Stocks are still waiting on a direction.

Tuesday was day 18 for the daily equity cycle. A break above the day 9 high of 3983.57 will assure us of a right translated daily cycle formation as stocks resume their intermediate cycle advance. However as we discussed yesterday, the bearish divergences developing on the oscillators point to a daily cycle decline. If stocks break below the 10 day MA and close below the 3940 level then the gravitational pull of the pending DCL will likely take over and send stocks to seek out their daily cycle low.