Stocks formed a bullish reversal off of support from the 50 day MA on Monday. They formed a swing low on Tuesday. Stocks have been in a daily uptrend characterized by highs forming above the upper daily cycle band and lows forming above the lower daily cycle band. Since Monday’s low formed above the lower daily cycle band that indicates that stocks will remain in their daily uptrend and trigger a cycle band buy signal.
Now, here are 3 things to watch going forward.
- Recovery of the 10 day MA. A close above the 10 day MA will have us label day 20 as a half cycle low.
- Right translation. A break above last Wednesday’s high of 4393.68 will shift the odds towards a right translated daily cycle formation.
- Resuming the intermediate cycle advance. If RSI 05 becomes embedded once again in overbought, that will signal the resumption of the intermediate cycle advance.
Cycle Trading 