We discussed on Tuesday whether or not June 9th marked a daily cycle low. Today’s rally has provided some clarity.
The recent volatility had obscured our daily cycle count making it uncertain if day 28 represented an early daily cycle low or a half cycle low. What is certain is that stocks peaked on May 20th and began a daily cycle decline. Stocks closed below the upper cycle band on May 26 and continue to decline. Stocks broke below the lower cycle band and printed their lowest point last Tuesday, June 9th. Stocks rallied out of the June 9th low but was turned back by the declining cycle trend line. However, the clear and convincing break of the declining cycle trend line confirms today as day 7 of a new daily cycle.