Cycle Trading: Miner Temptation
|Thursday was day 47 for the daily Miner cycle. That places the Miners deep in their timing band to form a daily cycle low. Thursday's bullish print eases the parameters for forming a swing low. With the Miners in a daily uptrend it is very tempting to buy the swing low.
Even though the Miners are late in their timing band for forming a daily cycle low the Miners have not yet broke below the (blue) daily cycle trend line. The Miners should break below the daily cycle trend line in order to complete its daily cycle decline.
The status of the dollar's cycle also has me skeptical that a daily cycle low has formed.
Thursday was likely day 4 for the dollar's daily cycle. The dollar still needs to break above the declining trend line to confirm the new daily cycle. And once the new daily cycle is confirmed, that increases the odds that dollar has also begun a new weekly cycle.
The dollar printed its lowest point last week. At 31 weeks the dollar is late in its timing band to form an ICL. A weekly swing low and a break above the declining 10 week MA will confirm the new intermediate cycle. A break above 92.69 will form a weekly swing low. So once the new daily cycle is confirmed, that increases the odds that dollar has also begun a new weekly cycle.
Which would be bearish for precious metals.
Perhaps that is why the Miners prints a large Selling on Strength number on Thursday.
Both the Junior Miners and the Miners printed large Selling on Strength numbers that aligns with a rallying dollar which foreshadows more downside for the Miners.
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