Squawk Morning Briefing: Disappointed Fed Doesn’t Disappoint

In its written statement and in comments by Chairman Bernanke, the Fed expressed disappointment at the pace of the U.S. recovery.   Even though they expressed their belief that many for the drags on GDP would be temporary they lowered their 2011 and 2012 forecasts.  Once again, the FOMC came through and delivered what many traders were looking for: a shot of volatility.  This one led to the downside.   The sell-off circled the globe with many overnight markets down.   A notable exception was China where overnight reports indicated slowing growth.   The presumption is that this that this will lead to policy easing that will be beneficial to business.   This is akin to buying on bad news here in the U. S. on the hopes that it will lead to QE3 or for Detroit Lions fans to root for their team to lose so they can get a good draft pick.

At the end of the day, prices were at a sport where they really needed to turn up or else the bearish counts would take center stage.   The short-term bullish view could be salvaged with buying at the open, but that is looking less likely with futures down solidly overnight.   Details are in our videos.

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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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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.
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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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