Cycle Trading: Weekend Report Preview

LikesMoney Independent Analyst

The Dollar

The dollar formed a daily swing low on Wednesday.

The dollar printed its lowest point on Monday, day 20, to place it in the early part of its timing band for a daily cycle low. The dollar closed above the converging 10 day MA and the 50 day MA on Friday so we will label day 20 as an early DCL. The dollar also closed above the upper daily cycle band on Friday to indicate that the dollar will remain in its daily uptrend. Closing above the upper daily cycle band also signals that the intermediate cycle low has been set.

The dollar printed its lowest point on week 17, which was early for an ICL. But the rally off of support from the 50 week MA indicates that week 17 was the ICL. This week the dollar printed a bullish weekly reversal and close back above the 10 week MA, which has caused it to turn higher. So we will label week 17 as the ICL. The dollar currently is in a weekly uptrend. The dollar will continue in its weekly uptrend unless it closes below the lower weekly cycle band.

Stocks

Stocks formed a daily swing high on Wednesday.

Wednesday was day 34 for the daily equity cycle, placing stocks in their timing band for a daily cycle low. So Wednesday’s swing high should send stocks into their daily cycle decline. A close below the 10 day MA will indicate the daily cycle decline.

Stocks did close below the 10 day MA on Thursday but then printed a bullish reversal on Friday to close back above the 10 day MA. This makes our daily cycle count unclear. Stocks did not do enough to say that day 34 was the DCL. What is clear is that stocks are in a daily uptrend. If stocks form a swing low here they will remain in their daily uptrend and trigger a cycle band buy signal. A break above 3118.97 forms a daily swing low.

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LikesMoney

Independent Analyst

Assets (such as stocks, gold, and the dollar) have identifiable cycles.

EUR/USD hits two-day highs near 1.1820

EUR/USD picks up pace and reaches two-day tops around 1.1820 at the end of the week. The pair’s move higher comes on the back of renewed weakness in the US Dollar amid growing talk that the Fed could deliver an interest rate cut as early as March. On the docket, the flash US Consumer Sentiment improves to 57.3 in February.

GBP/USD reclaims 1.3600 and above

GBP/USD reverses two straight days of losses, surpassing the key 1.3600 yardstick on Friday. Cable’s rebound comes as the Greenback slips away from two-week highs in response to some profit-taking mood and speculation of Fed rate cuts. In addition, hawkish comments from the BoE’s Pill are also collaborating with the quid’s improvement.

Gold climbs further, focus is back to 45,000

Gold regains upside traction and surpasses the $4,900 mark per troy ounce at the end of the week, shifting its attention to the critical $5,000 region. The move reflects a shift in risk sentiment, driving flows back towards traditional safe haven assets and supporting the yellow metal.

Crypto Today: Bitcoin, Ethereum, XRP rebound amid risk-off, $2.6 billion liquidation wave

Bitcoin edges up above $65,000 at the time of writing on Friday, as dust from the recent macro-triggered sell-off settles. The leading altcoin, Ethereum, hovers above $1,900, but resistance at $2,000 caps the upside. Meanwhile, Ripple has recorded the largest intraday jump among the three assets, up over 10% to $1.35.

Three scenarios for Japanese Yen ahead of snap election

The latest polls point to a dominant win for the ruling bloc at the upcoming Japanese snap election. The larger Sanae Takaichi’s mandate, the more investors fear faster implementation of tax cuts and spending plans.

XRP rally extends as modest ETF inflows support recovery

Ripple is accelerating its recovery, trading above $1.36 at the time of writing on Friday, as investors adjust their positions following a turbulent week in the broader crypto market. The remittance token is up over 21% from its intraday low of $1.12.