The cycle line is constructed by taking the opposite extremes of a cycle. Connecting the previous high to the subsequent low, and vice vera: connecting the previous low to subsequent high. Parallels are then drawn from the high/low, identifying the cycle channel as demonstrated on the chart.
The ANGLE of the cycle gives you a roadmap into the future as to what type of move one can expect. The steeper the angle the greater the tendency for a market to rally/decline rapidly.