Cycle Trading: Possible Turning Points
|The dollar broke below the previous daily cycle low on Monday forming a failed daily cycle.
Monday was day 36 for the dollar's daily cycle. That places the dollar late in its timing band to print a daily cycle low. Monday's bullish reversal has eased the parameters for forming a daily swing low. A break above 99.33 forms a daily swing low which has good odds of marking the DCL. A close back above the declining 10 day MA will confirm the new daily cycle.
Stocks also printed a bullish reversal on Monday.
Monday was day 58 for the daily equity cycle, which is late in its timing band for stocks to form a daily cycle low. Stocks finally broke the daily cycle trend line, which needed to happen in order for stocks to complete their daily cycle decline. And once again, the bullish reversal has eased the parameters for stocks to form a daily swing low. A break above 2344.90 forms a daily swing low, which should mark the DCL. Then a close back above the declining 10 day MA will confirm the new daily cycle.
And not only are both the dollar and stocks forming daily cycle lows, but I think that we will find that both are also in the process of forming intermediate cycle lows as well. I plan to discuss the weekly cycles for both the dollar and stocks on Wednesday.
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