Stocks printed their lowest point on Monday, day 17, which is early to expect a daily cycle low to form. The longer term weekly chart (above) shows stocks reversed off a previous resistance level. At 35 weeks, there is a good chance that day 17 not only marked the daily cycle low, but the intermediate cycle low, as well. But first we need to confirm a new daily cycle.
Stocks formed a swing low on Tuesday, closing above the 10 day moving average on Wednesday to signal day 17 as the daily cycle low. However, stocks closed back below the 10 day moving average on Thursday, calling into question if day 17 was the daily cycle low.
The decline into the day 17 low caused stocks to become very stretched below the 10 day moving average. After such a move often times stocks will need to consolidate that move. We will need to see a close back above the 10 day moving average to re-label day 17 as the DCL. But a break below the day 17 low of 4835.04 would extend the daily cycle decline. Stocks are currently in a daily downtrend. They will remain so unless they close back above the upper daily cycle band.
Cycle Trading 
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