Following the day 18 peak bonds printed their lowest point on Thursday, which was day 23. That places bonds in their timing band for a daily cycle low. Friday’s break above the declining trend line signaled a new daily cycle.
Bonds formed a swing high today as they closed back below the upper daily cycle band. While bonds could be extending their daily cycle decline, I suspect that the new daily cycle is rolling over. And if I am right that the new daily cycle is already rolling over, then a break below 130.49 forms a failed daily cycle and signals that the intermediate cycle is in decline.
The yearly bond cycle is typically comprised of 2 to 3 intermediate cycles. Bonds are currently in their 3rd intermediate cycle of the year. A failed, left translated intermediate cycle is required to usher in the yearly cycle decline. Left translated intermediate cycles normally peak by week 8.
So getting back to the daily cycle. If today was day 2 for the new daily cycle, then a break below 130.49 forms a failed daily cycle signaling that bonds have begun their intermediate cycle decline. With bonds only on week 6, that leaves 10 to 16 weeks for bonds to print their intermediate cycle low. A break below the week 17 low 126.95 forms a failed intermediate cycle and confirms the yearly cycle decline.