The 3/11/16 Weekend Report Preview

The Dollar

The slightly lower low on Friday has eased the parameters for the dollar to form a daily swing low.

The dollar is in its timing band to print a daily cycle low. A break above Friday's high of 96.76 would form a daily swing low and signal a new daily cycle. However, by closing below the lower daily cycle band on Thursday and Friday signals that the dollar is continuing its intermediate cycle decline. A break below the previous daily cycle low of 95.28 forms a second consecutive failed daily cycle.

The intermediate dollar cycle peaked in November, which was week 14. It went on to print its lowest point in early February. The February low was week 24, placing the dollar in its timing band to print an intermediate cycle low. So if this daily cycle does break below 95.28 it will extend the intermediate cycle out past week 28.

There is another possibility that we need to be aware of. That would be for the dollar to form a daily swing low early next week. A swing low early next week would lock in a right translated cycle formation and keep the dollar from forming a failed daily cycle. That would also mean that week 24 hosted the intermediate cycle low making this week 4 of a new intermediate cycle. This scenario aligns with what I see developing on the yearly and 3 year cycles.

Stocks

The new high on Friday, day 19, shifts the likelihood that stocks are forming a right translated daily cycle.

A right translated cycle formation would deliver further evidence that February hosted an intermediate cycle low. Stocks are currently closing above the upper daily cycle band, which indicates that they are in a new daily uptrend. They will remain in a daily uptrend until they close below the lower daily cycle band.

Stocks closing above the upper daily cycle band indicates that week 24 hosted the intermediate cycle low. A weekly close above the upper weekly cycle band would indicate that February also was the yearly cycle low.