Cycle Trading

Cycles provide a framework for viewing the market through recurring phases of advance and decline, each with a typical timing band measured in days, weeks, and months. Markets rally, peak, and then decline into a cycle low. How daily cycles interact with weekly cycles helps define directional tendencies and identify higher-probability trade setups.

Friday’s action in stocks fits squarely within that framework. With stocks losing the 10 day moving average on day 25, the focus has shifted to the early portion of the daily cycle low (DCL) timing band. This daily-cycle weakness is occurring alongside broad cross-market cycle alignment, reinforcing the importance of monitoring cycle behavior rather than reacting to isolated price moves.

Across markets, we are seeing a similar pattern of swing highs and breaks below the 10 day moving average, suggesting synchronized daily-cycle pressure:

Dollar: Closed back above the 10 day MA on Tuesday, diverging from risk assets

Stocks: Formed a swing high and closed below 6900 on Monday

Gold: Formed a swing high and closed below the 10 day MA on Monday

Miners: Formed a swing high and closed below the 10 day MA on Monday

Oil: Formed a swing high and closed below the 10 day MA on Friday

Bonds: Formed a swing high and closed below the 10 day MA on Wednesday

This broad-based loss of short-term momentum across multiple asset classes highlights why cycle analysis is most effective when viewed in a multi-market context. While stocks remain in a daily uptrend for now, the interaction between weakening daily cycles and still-intact weekly trends will be critical in determining whether this decline resolves as a routine DCL—or evolves into something more consequential.

The goal of the Weekend Report is to continuously refine this framework of expectations by tracking daily, weekly, and yearly cycles across the Dollar, Stocks, Gold, Miners, Oil, and Bonds, alongside the Likesmoney Cycle Tracker. This ongoing process helps keep risk aligned with cycle position rather than emotion or headlines.