How do you do it? There are many variations. The simplest is to stop taking E for a few days every month. Some gradually lower E as they add progesterone proportionally. Some lower their dose.
Why do you do it? People cycling their hormones have the belief that "since we don't know for sure, we might as well mimic nature, since it seems to work well on born females".
However, there is absolutely no proof of this technique having any use whatsoever. Rather, the very little evidence available tends to show that cycling is detrimental. However, it is not dangerous, so I guess you can if you want. The only risk is to have non-optimal development overall, and even this is not sure.
However, the only specialists who believe in cycling, if I remember well, do so without any proof; it's just a philosophy of prudence and following nature that they have.
EDIT: Oh, there is this other reason too: Cycling hormones tends to induce some PMS/etc.-like symptoms, such as mood swings. Some patients feel more female if they can at least experience a very small part of what it is to have a period.