Cycle Trading: Dollar Direction
|The dollar's daily cycle tagged the 50 day MA as it peaked on day 9. The ensuing swing high closed below the 10 day MA to send the dollar into its daily cycle decline.
The dollar rallied off of support from the 200 day MA on Thursday, day 14. The dollar delivered bullish follow through on Monday. Since 14 days is too early to expect a daily cycle low it is likely that day 14 is a half cycle low. On Monday, the dollar tagged the declining trend line and the declining 10 day MA. The dollar should choose its direction here. A close above the 10 day MA will have us label day 14 as an early daily cycle low. However, rejection by the 10 day MA should send the dollar lower to complete its daily cycle decline. And with a peak on day 9, that favors a left translated daily cycle formation which makes it likely to see the dollar break below the previous DCL to form a failed daily cycle. A break below 94.64 forms a failed daily cycle. The dollar is currently in a daily downtrend. It will remain in its daily downtrend unless it closes above the upper daily cycle band.
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