Squawk Morning Briefing: Market Concerns

We care about market concerns because they tell us which news events deserve more attention.   As always, we care more about when to expect movement and the reaction to the report than the report itself.  Any report can move markets if there’s enough surprise, but there are ones which we can anticipate to be important based on recent events.

Last month markets reacted poorly to regional Fed surveys that unexpectedly provided an early warning to of slowing economic activity.   These warnings played out later in month in broader surveys such as the ISM reports and various employment reports.   It will also likely show in Wednesday’s Industrial Production numbers which are for the month of May.   But Wednesday also brings the Empire State Survey, the first of the regional reports which will continue to come in for several days.   Traders may pay unusual attention to these reports this week since the question on everyone’s mind is whether last month was just a blip, or a change in trend.   When the economy seems to be trending either up or down and people know what to expect, then the numbers don’t mean much unless there’s a surprise.   But when there’s a question mark then people pay extra attention.

This week is also options expiration and a number of futures contracts also expire.   So the next few days could get volatile.  Hopefully it will start to clarify some of the patterns we’re looking at in charts.

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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?
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• What intermarket movements merit special attention to understand likely price trends?

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