Cycle Trading

PRE-SUMMARY

BTC reversed back above the 50 day MA after briefly breaking below the lower daily cycle band. A close above the 10 day MA would support labeling day 55 as the DCL.

BTC closed below both the 50 day moving average and the lower daily cycle band on Friday, day 54, to extend the daily cycle decline. Closing below the lower daily cycle band ended the prior daily uptrend and signaled the beginning of a daily downtrend. However, BTC did not deliver bearish follow through.

Instead, BTC formed a bullish reversal on Saturday and closed back above the 50 day moving average on day 55, signaling a potential DCL. BTC then formed a swing low on Sunday and is currently in the process of breaking back above the converging 10 day moving average and 50 day moving average on Monday. From a cycle perspective, confirmation will still be needed. A close above the 10 day moving average would indicate a continuation of the larger trend structure and have us label day 55 as the DCL.

While BTC quickly reclaimed support after briefly breaking below the lower daily cycle band — it remains near important resistance as the 10 day moving average and 50 day moving average continue converging. If BTC can decisively reclaim the 10 day moving average, then it would strengthen the case that the daily cycle decline has already bottomed and that a new advancing phase is underway.

Cycle Alignment:

• Mixed