On Saturday we noted that stocks had formed a daily swing high.  They delivered bearish follow through on Monday.  



Monday was day 41 for the daily equity cycle.  That places stocks in their timing band for a daily cycle low. Closing below the 10 day MA indicates that stocks have begun their daily cycle decline.  The daily cycle decline typically lasts 7 - 10 days.   The peak on day 39 locks in a right translated cycle formation which gives us the expectation that stocks will form a higher daily daily cycle low.  Stocks are in a daily uptrend. If stocks form a swing low above the lower daily cycle band then stocks will remain in their daily uptrend and trigger a cycle band buy signal.

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