Intermediate Cycle Decline

This is the fourth daily equity cycle for the current intermediate cycle. Our expectation is for this daily cycle to form as a left translated daily cycle, which should peak on or before day 20. Then roll over forming a failed daily cycle that leads into the intermediate cycle decline.

The daily equity cycle peaked on day 8. After a three day pull back stocks were making an attempt to break out to a new high on Friday.

spx daily

Stocks were turned back Monday in a clear and convincing fashion. Stocks had broke bearishly out of the trading box that was developing, signaling a daily cycle decline. The zero line crossover on the True Strength Indicator is another signal that stocks have entered the primary decline into a daily cycle low. With a daily cycle count of 16 days, stocks can still trend lower for the next three to six weeks.

So stocks have been in decline for 8 days and Gold’s daily cycle continues to develop bullishly at day 8.

$ GOLD Sharp Charts Workbench Stock Charts com

The daily gold cycle formed another higher high on Monday. If this is the first daily cycle of a new intermediate cycle then we should see gold form a right translated daily cycle here. Setting a new cycle high past day 14 will signal a right translated nature to this daily cycle. Another task for gold is to break above the previous daily cycle high of 1267.50. Doing so will reverse the pattern of lower highs.

The dollar following through lower today will likely help propel gold higher.

DXY00 Commodity Futures Price Chart for U S D

The daily dollar cycle peaked on day 8. A swing high and trend line break formed on day 9, signaling a daily cycle decline. Monday saw the dollar provide more follow through lower. The dollar is continuing its decline into a daly cycle low. With the timing band for a daily cycle low beginning at day 18, the dollar can trend lower for another 8 to 18 days.


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