The swing high off the day 25 peak signals that a daily cycle decline is imminent.
Being this late in the daily cycle suggests a brief decline. Still the dollar should break below the daily cycle trend line before printing its daily cycle low.
Our framework has the dollar printing a three year low in May. Therefore we should see the dollar back test the consolidation before continuing higher.
Stocks printed their lowest point on Thursday since the day 29 peak. Thursday was day 39 and stocks are in their timing band to print a daily cycle low. Therefore, the swing low formed on Friday signals a new daily cycle.
Stocks delivered a bullish crossover on the TSI which supports the notion that Friday was day 1 of a new daily cycle. While we are looking for a break of the declining trend line to confirm a new daily cycle, regaining the 10 day MA adds another confirmation.
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