The bullish reversal on day 39 followed by the swing low last Friday looked, in real time, like a daily cycle low formed.
While it is possible that the daily cycle peaked on day 2, the Buying on Weakness numbers suggest otherwise.
There has been over 1 billion in Buying on Weakness since last Wednesday. These are the type of numbers more associated with an intermediate cycle low. Therefore the possibility exists that Tuesday was day 42 for the daily equity cycle. And once a lower low will form before stocks make a run back up to test the recent highs.
But the weekly chart shows a more bearish view.
The intermediate equity cycle peaked on week 6. A weekly swing high formed on week 7. A trend line break was delivered last week and now this week there is a bearish zero line crossover on the True Strength Indicator. All of these signal that stocks have entered their intermediate cycle decline. So if stocks have yet to form their daily cycle low, any rally should be short lived before rolling over and continuing the intermediate equity decline.