Stocks retraced well below the 61% Fibonacci level on Friday before forming a bullish reversal off support at the 50 day moving average. That rebound set the stage for a strong follow-through on Monday, when stocks formed a swing low and closed back above the 10 day moving average.
Friday marked day 20, which is early for a typical daily cycle low (DCL) to form. However, since stocks are in a daily uptrend, forming a swing low above the lower daily cycle band and then closing back above the 10 day moving average confirms a new daily cycle and triggers a cycle band buy signal.
This confirms that day 20 hosted the DCL, establishing a new daily cycle. Continued strength above the 10 day moving average would support a renewed advance toward a higher cycle high.
Cycle Trading 
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