Stocks found support at the 10 day MA on Tuesday.
The initial surge out of the DCL caused stocks to get stretched above the 10 day MA. Stocks have been coiling to allow the 10 day MA to catch up to price. Stocks should go on to break above the declining trend line as they rally out of their daily cycle low.
Notice the change in behavior for RSI 05. Prior to the DCL, RSI 05 was embedding in oversold which is characteristic of the declining phase of the intermediate cycle. That is beginning to change. If RSI 05 embeds in overbought that will signal that stocks are now in the advancing phase of a new intermediate (weekly) cycle.
Cycle Trading 
Leave a comment