Tuesday night we discussed how stocks were close to confirming a new daily cycle but at the time, no cigar…
Well today stocks broke above the declining trend line to confirm a new daily cycle. Stocks are emerging from a failed daily cycle. With last week being week 10, stocks have up to 7 to 11 more weeks before an intermediate cycle low is due. The failed daily cycle means that our expectation is to see left translated, failed daily cycles until an intermediate cycle low has formed. However, should stocks break to a new high then we will be forced to recgonize 10/15 as a shortened intermediate cycle low.
Bonds continued lower today.
Thursday was day 26 for the daily bond cycle. Bonds are moving into the later stages of their timing band to print a daily cycle low. The bullish reversal today off the September high could mark a daily cycle low. A break above 120.18 forms a swing low and quite possibly the daily cycle low.
Bonds are in month 10 of their yearly cycle. So bonds have entered their timing band for a yearly cycle low, as well. A failed daily cycle and a failed weekly cycle is needed to mark the yearly cycle decline. Therefore our expectation is to see the new daily cycle form in a left translated manner, peaking by day 8. Then rolling over into a failed daily cycle.