Come in to My Parlor…

Before the open we get the BLS report followed by a full day of pre-holiday trading. Few participants could lead to a lifeless trading sessions but surprise moves could lead to more violent swings than usual due to lack of liquidity.   Predicting which of these or other scenarios might unfold is nothing more than a parlor game. On a slow day such a game may be an enticing way to pass the time, but the danger comes when you put your money to work behind that speculation.  Those who do might find creatures more nefarious than spiders waiting to prey upon their hard earned capital.

We’re mostly here to talk about markets from an Elliott Wave perspective, but from our perch there’s not much more to say than we did yesterday.  Thursday’s equity markets were mostly up on waning momentum and carried into our target ranges with wave structures that could count complete.  We want to underscore the importance of the distinction between could and does.  “Could count complete” means that we’ve been anticipating a turn downward in U.S. equities and if markets turn down now then we have a wave count that explains it.  It also means that markets could turn down from higher; or not turn down at all.  That being said, the the cautious move upward into a target area could be the market’s indication that markets expect a poor jobs report and are ready to turn.  If so then we would today could mark the beginning of a third wave down.  We may know more by the end of the day.

We do not want to spend too much of your time rehashing what we said yesterday, so some of our updates today will be brief.

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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?

Markets Covered:

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

• The Dow Jones Industrial Average
• YM e-Mini Dow Futures
• The S&P 500
• The EUR/USD cross
• The U.S. Dollar Index
• 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.

At the end of the day Squawk subscribers will receive a brief market recap that summarizes how the day’s events compared with expectations and what issues are likely to be analyzed in the following morning’s Elliot Squawk.

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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