A New Daily Cycle

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The cycle count was unclear when we last looked at the daily equity cycle.

spx

Stocks formed a bearish reversal on day 21 that sent stocks dipping below the 50 day MA. An early day 28 cycle low appeared to have formed followed by stocks regaining the 50 day MA. Since 28 days is a bit short of the normal timing band for a daily cycle low, we wanted to see if stocks would break lower extending the daily cycle decline or break higher thereby confirming a new daily cycle.

Today stocks broke higher.

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Stocks broke out to a new high on Monday. Breaking above the previous daily cycle high confirms day 28 as an early daily cycle low. Which makes today, day 8 for the new daily cycle.

The dollar now seems to be on the verge of confirming a new daily cycle.

$$$ daily

After peaking on day 11 the dollar lost the 50 day MA and printed its lowest point on Thursday, day 34. Friday saw the dollar form a daily swing low, but still closed lower. However the dollar delivered some bullish follow through on Monday, testing the declining trend line. The dollar is deep in its timing band for forming a daily cycle low. A clear and convincing break of the declining trend line will confirm a new daily cycle.

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