Cyce Trading: Weekend report review
The Dollar
The dollar peaked on day 5, setting up a left translated daily cycle formation.
The dollar was rejected by the declining 50 day MA on Thursday and closed lower on Friday to signal the daily cycle decline. This appeared to be the first daily cycle to a new intermediate cycle. But a close below the lower daily cycle band will indicate a continuation of the intermediate cycle decline. Currently, the dollar is in a daily downtrend. It will remain in its daily downtrend unless it can close back above the upper daily cycle band.
Stocks
We have been watching this megaphone topping pattern.
Stocks appear to have delivered a classic false breakout. Stocks formed a swing high and closed below upper stem of the megaphone to signal the daily cycle decline. With stocks in their timing band for an intermediate cycle decline - this could trigger the intermediate cycle decline and a revision to the mean.
Friday’s undercut low may have sent ‘everyone’ to the wrong side of the boat. A swing low and close above the declining trend line would set the stage for stocks to recover the upper stem of the megaphone. With a break above the day 56 high. - I would submit that the flood of liquidity would be overwhelming our timing bands and that stocks are entering a bubble phase.
Reprinted from FXStreet，the copyright all reserved by the original author.
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