2 June 2022
For every trading day the Monkey Cycle Indicator calculates two very important levels, the critical support and the critical resistance. That information is shown in the right upper corner of each chart:
Those two levels, resistance and support, define a trading range for the day. The way how the price opens the morning trading session at 9–30 AM EST and interacts with those bands help us to define our directional bias for the day.
This is how NQ-mini opened the trading session on June 2nd, 2022:
NQ-mini opened the day by spiking under the critical support but that weakness was immediately bought out. After ten minutes of sitting at support price popped, then came back to support again, then popped and re-tested the support. Note that every trip back down to that support level made a slightly higher low.
As you can see, bears failed to break under the daily support and that failure triggered a very strong 300-point short covering rally!
Now let’s look at signals produce by the multi timeframe version of the Cycle Indicator today:
The MTC Cycle Indicator printed the Strong Short Signal on RTY and ES-mini charts pre-market:
That signal delivered a really nice strong decline at the open:
By 10-00 AM EST ES quickly dropped by 40 points.
As you can see on the chart above, ES-mini landed right onto a cyclical support on 240 min timeframe (you can see number”240″ to the left of the lower thick green line which shows a support printed by a cycle on 2140 min timeframe):
NQ-mini tested the same support:
When you look for an attractive long setup based on cycles analysis you should wait until several cycles bottom at one time. This is exactly what happened that morning:
Note that that morning ES dropped to another support produced by another cycle on 120 min timeframe. The green line is a support drawn by the Cycle Indicator when it detects that a cycle has bottomed or about to bottom. In addition, another cycle on 15 min timeframe bottomed:
According to the principle of Synchronicity proposed by the founder of cycle theory, JM Hurst, from time to time several distinctive cycles reach their respective bottoms simultaneously. Hurst also argued that adding several cycles together we can explain movement of price. He called that the Principle of Summation. If we take into consideration the Principle of Summation and the Principle of Synchronicity, we can conclude that points when several cycles make bottoms at one time should be aligned with important lows on stock price charts.
The strong rally that followed in ES-mini and NQ-mini is a good case study confirming principles of cycle analysis proposed by JM Hurst.
The multi timeframe version of the Cycle Trader Indicator helps traders to detect points when several cycles simultaneously make tops and bottoms. Those points are high probability reversal points:
You can start trial of the indicators here.
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