Cycle Trading

Stocks closed back below the 10 day MA on Monday, calling into question if day 17 was the DCL.

Part of our rationale for labeling day 17 as the DCL was the longer term weekly chart (above) showed that stocks reversed off a previous resistance level and the fact that stocks were deep in their timing band for an intermediate cycle low. Which meant that the day 17 low could possibly also mark the ICL. 

And the day 17 low could still turn out to be the DCL. Despite stocks closing 2.36% lower on Monday, the 10 day MA managed to turn higher. What is clear is that stocks are currently in a daily downtrend. Closing back below the 10 day MA indicates a continuation of its daily downtrend and signals a cycle band sell signal.