Cycle Trading

Stocks formed a swing low on Monday.

The rally out of the late February DCL saw stocks get stretched above the 10 day MA last Tuesday. Stocks retraced to backtest the 200 MA on Friday, forming a bullish reversal. Stocks followed that by forming a swing low on Monday. Stocks are currently in a daily uptrend. Forming a swing low above the upper daily cycle band indicates a continuation of the daily uptrend and triggers a cycle band buy signal. We will use Friday’s pivot to construct the daily cycle trend line.