Squawk Morning Briefing: Sitting Bulls Last Stand?

We continue to have many different count possibilities for equities.  What most of them have in common is that most suggest we’re still going to new highs, and most suggest that the move is running out of steam.  Whether its a triangle count that implies the next move will be the last, or an ending diagonal count whose name even tells us that the move is terminal, many of the possibilities suggest that the upward push is just about out of steam.

This is consistent with what we see in bullish attitudes.  In the middle of bull runs, people find fundamental reasons to be bullish.  At the end, investors are complacently bullish; believing that markets will continue upward simply because that’s what they have been doing.  There is no target or valuation; or when there is a target it is absurd.  One analyst on TV this week asserted that AAPL is headed toward a $2 Trillion market capitalization.  These are the types of attitudes the precede a fall.

While we see many elements in the wave structure which suggest that fall may come after one more push up, the bullish attitudes we’ve cited can keep markets aloft for some time.  So as always we’ll look for confirmation of any turn.  We’ll begin looking at confirmation levels once we see indications of an impending peak.

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Elliott Squawk delivers thorough market preparation every morning in time to take action during the trading day. By combining up-to-the-minute futures activity with traditional end-of-day analysis from cash indices, you receive analysis based on the latest conditions as the trading day sets to open. Each issue of Elliott Squawk goes beyond traditional Elliott Wave analysis because we recognize that trading Elliott Waves is much more than just looking at the most likely current count. Squawk will prepare traders to assess the market action as it unfolds by answering questions that any Elliott Wave trader should consider:

• What price levels and wave motions would confirm an expected move?
• What price levels would make an alternate scenario more likely?
• What technical indicators should be watched throughout the day to interpret wave action?
• What intermarket movements merit special attention to understand likely price trends?

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Each day Elliott Squawk will update the outlook for the following markets:

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• The S&P 500
• The EUR/USD cross
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• U.S. Treasury bond futures

From time-to-time when circumstances warrant, Squawk will present analyses of other markets that help interpret wave action in a covered market. For example:

• If S&P 500 and Dow counts are ambiguous and NASDAQ behavior helps identify the likely next move then NASDAQ analysis will be presented.
• If the EUR/USD count is ambiguous and the USD/CHF cross helps us to understand what might happen then we’ll present the intermarket analysis the Squawk subscribers.

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About the Analysts

Kevin McEwen and David Starr are best known to First Wave chat room participants as Kevy99 and Managematics and by their reputation for their Elliott Wave counts that have predicted market turning points. Kevin has been counting Elliott Waves for 28 years, successfully forecasting market moves in virtually every financial environment. David brings together talents in financial market analysis and software development to his wave counting. He has authored many of the studies used by First Wave Traders as well as a number of proprietary studies to aid in counting waves.

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