Cycle Trading

Pre-Summary

The dollar has formed a failed daily cycle. The next question is whether that weakness begins changing the longer-term picture.

The dollar ran into resistance above the 101.60 level on Tuesday, Day 9. Wednesday’s swing high and close below the 10-day MA signaled the daily cycle decline, with the Day 9 peak favoring a left-translated daily cycle. Thursday delivered bearish follow-through.

The dollar has now broken below both the 50-day MA and the previous Daily Cycle Low (DCL), forming a failed daily cycle and signaling the intermediate cycle decline. The dollar is also testing the lower daily cycle band. A close below the lower daily cycle band would end the current daily uptrend and begin a daily downtrend. A failed daily cycle doesn’t just affect the daily chart. It can also have important implications for the larger cycle structure.

Today’s chart focuses on the failed daily cycle. In this weekend’s subscriber report, we’ll examine what this breakdown may be signaling for the dollar’s weekly and yearly cycles—and why those longer-term trends could now be at risk.

Current Framework

Trend: Daily uptrend under pressure.

Cycle: Failed daily cycle signals the intermediate cycle decline.

Next Trigger: A close below the lower daily cycle band ends the daily uptrend and begins a daily downtrend.