Please check the Dashboard daily for updated market commentary.
Due to the specificity of our wave counts we have included a labeling system to break down the level or degree of the wave which represents the size of the underlying trend.
After the last day of trading each week we will go over the most salient points with weekly market comments below.
Please note, all of our updates follow New York, Eastern Time Zone of USA.
Daily Market Recap - 7.19.19 8:42 AM
Each new peak has led to a corrective move since the September selloff. The price momentum and relative strength are displaying divergences you typically see at market tops. The current level of the VIX is telling us that risk-reward in the stock market could strongly favor the short sellers. With stocks at near record highs, a dramatic correction is on the horizon over the coming weeks or months. We believe that market plunging action will occur suddenly without much warning, be ready and stay sharp, we expect wave E to be more vicious than the wave C.
Weekly Market Recap 7.20.19 1:33 AM
The current Elliott Wave cycle degree indicates we're at the end of the economic cycle. The US leading economic Indicators have been contracting for many months such as new orders for business and housing starts. The global PMI has been in a trend of sharp deceleration for the past 2 years and the US ISM PMI data has contributed heavily to that deceleration. The latest comments from the FRB meeting minutes also validated overall softness mentioned. Furthermore, if you add in the uncertainty created by the US CHINA trade war and the possibility of a hard Brexit, and you have a recipe for sudden shock to the stock market. For now, despite the deteriorating macro condition we are left to gasp at the idea of another QE with a new record highs in the stock market along with a very low unemployment numbers. It is not uncommon for the markets to rise when the economy is contracting but it is also not uncommon for markets to crash under these scenarios especially if you are at the end of the business cycle. Remember, if many mainstream pundits thought the economy was about to go gangbusters, small caps should theoretically outperform large caps because small companies rely more on economic growth for their revenue growth. As we predicted, the Russell was left out and this is inline with the wave D interpretation on DJIA and S&P 500 which give us tremendous confidence on our wave E forecast. The equity market topping process takes time and sometimes very arduous unlike the commodities topping process where its sharp and sudden. Please be patient, we think the SHORTS will be handsomely rewarded with our journey down to wave E.