Elliott Wave Market Analysis

The market has been choppy and flat so there's not much new to report.  Some warning signs of the bullish move are surfacing but none are confirmed, so the market may continue higher indefinitely.  The wave count looks mature on at least a short term perspective.  The market appears drawn to the 2100 level I have been targeting for months, and it should find at least a minor pullback after hitting that level.  Right now I'm just waiting for confirmation of several bearish indicators and will report them here when they surface.  Until then, I'm patiently waiting for the bulls to run out of gas.

Another piece to consider today is the divergence between the S&P and the Russell and S&P MidCap indexes.  The S&P is outperforming the two significantly, as I assume it has a key level to achieve today of 2100.  So we'll see if this divergence holds into the close today.  Usually, when a divergence like this holds all day, it results in some pullback the next day, if not a a large bearish move.

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PLEASE NOTE: THIS IS AN ELLIOTT WAVE BLOG EXPRESSING AN OPINION AND IN NO WAY GUARANTEES OR IMPLIES ANY PROFIT OR GAIN. TRADE AT YOUR OWN RISK.

Elliott Wave Futures Signals - ES Topping Formation

The S&P is still topping and has a nice head and shoulders top formation in place and I expect the market to sell off any minute.  Not internal change to the bearish outlook as my proprietary indicators have 144 bearish signals triggered and only 6 bullish signals.

In looking at market breadth and internal strength I get a bit of a mixed bag but a slightly bearish bias overall.  The $DWC.X, Russell, and especially the Nasdaq all have slight or significant bearish divergence between price and advance/decline issues.  The Nasdaq and Russell being the worst.  And seeing as that those two indexes tend to be good risk barometers, and therefore they tend to be the first to signal new moves, that's why I have a slightly bearish bias to market breadth overall.

But to be fair and objective, the NYSE and ARCA, which are two very strong overall market bellwethers, actually have their advance/decline data rising higher than price, which is often a bullish indication.

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PLEASE NOTE: THIS IS AN ELLIOTT WAVE BLOG EXPRESSING AN OPINION AND IN NO WAY GUARANTEES OR IMPLIES ANY PROFIT OR GAIN. TRADE AT YOUR OWN RISK.

Elliott Wave Futures Signals - S&P ES

The stock market has played out as expected as the topping head and shoulders pattern is on the verge of being confirmed with a move below 2035.  The internal strength of the market has been weak for some time as my proprietary indicators shot off a high volume of sell signals with just a handful of bullish signals.  I've already cashed in on some of those bearish positions and will be looking to add more bearish stock positions as the opportunities arise.  For now, I see the S&P futures declining in wave (4) to the 1996-2014 area.  From there I will assess any bullish potential that may arise.

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PLEASE NOTE: THIS IS AN ELLIOTT WAVE BLOG EXPRESSING AN OPINION AND IN NO WAY GUARANTEES OR IMPLIES ANY PROFIT OR GAIN. TRADE AT YOUR OWN RISK.

Elliott Wave Futures Signals - S&P (ES)

The S&P continues higher as I cautiously projected and still feel there might be some more gas in the tank to hit my long awaited target of 2100.  I will not that the price action does not support my wave count well as you can see a very week price action clump over the past few weeks as noted by the light blue circles on my chart.  Not only is just visually weak, especially for what is supposed to be a wave (iii) of ((iii)), but almost all momentum indicators are showing divergence here.  At the end of a third wave at multiple degrees, momentum indicators should be showing overbought conditions which are signs of strength.  But here, we have nothing close to that.

In addition, my proprietary indicators continue to grow on the bearish side as 132 stocks have bearish signals while only 14 are bullish.  This is another sign that the stock market rally is on borrowed time.

I am not willing to get short until confirmation that the uptrend is over, or that at least a large pullback is underway.  Any breakdown of the previous swing lows will be nice to support the bearish case, which are at: 2035.25, 2019.25, 2012.25, and then the previous wave i should hold if the market is in a strong bullish move, and that's at 2008.  I remain very cautiously bullish as I await to get short the stock market, although I'm already short 6 stocks and only long 1 stock at the moment.

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PLEASE NOTE: THIS IS AN ELLIOTT WAVE BLOG EXPRESSING AN OPINION AND IN NO WAY GUARANTEES OR IMPLIES ANY PROFIT OR GAIN. TRADE AT YOUR OWN RISK.

Elliott Wave Futures S&P - ES

The bullish case is unraveling.  Here are the reasons why:

1) Wave ((4)) has not overlapped with wave ((1)), invalidating the count on a short term basis.
2) I would have to rework the count to an even larger group of 1 and 2 waves which is unlikely to be accurate.
3) The current action is not consistent with a wave 3 at multiple degrees.
4) My proprietary indicators show sell signals on 119 stocks and buy signals on only 20 stocks.

I think this bullish wave count on the S&P is about to be busted.  I am now looking for weakness in the stock market and will be looking for an opportunity to develop a bearish wave count.

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PLEASE NOTE: THIS IS AN ELLIOTT WAVE BLOG EXPRESSING AN OPINION AND IN NO WAY GUARANTEES OR IMPLIES ANY PROFIT OR GAIN. TRADE AT YOUR OWN RISK.

Elliott Wave Futures Signals - S&P ES

The S&P is testing channel line support right now in what is probably wave ((4)).  I expect a move higher from here to the middle line of the channel to complete wave ((5)) of iii.  A breakdown from here, and a strong daily close beneath channel line support, could signal something much more bearish in the works.

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PLEASE NOTE: THIS IS AN ELLIOTT WAVE BLOG EXPRESSING AN OPINION AND IN NO WAY GUARANTEES OR IMPLIES ANY PROFIT OR GAIN. TRADE AT YOUR OWN RISK.

Elliott Wave Futures Signals - S&P Futures

The S&P is bouncing along lower channel support, which means it is establishing that as a key level.  Preferably, I would like to see that support hold (no solid 4hr close beneath it) to keep the bullish count intact.  We're reaching a point where I'll have to continue drilling down with the series of 1st and 2nd waves which, in my experience, often means I'm trying to fit an impulsive rally into a correction.  But, as long as channel support holds and especially 1958, it means the series of higher highs and higher lows is intact and therefore a clear uptrend is in play.  The Fed news is behind us so we can go back to focusing on charts and technicals that brings us success.

I still expect the S&P to shoot up to the 2075-2100 rather quickly from here.

On another note, the AUDNZD shot up and took out my adjusted stop loss at break even, then dropped down to my target overnight in the London session, leaving me out of the trade for 0 pips.  Very frustrating to say the least.

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PLEASE NOTE: THIS IS AN ELLIOTT WAVE BLOG EXPRESSING AN OPINION AND IN NO WAY GUARANTEES OR IMPLIES ANY PROFIT OR GAIN. TRADE AT YOUR OWN RISK.

Elliott Wave Index Futures

The stock market appears to be headed towards channel line support of waves ((i)) and ((ii)) around 1992 before resuming its uptrend.  1957 is a key level for the S&P futures as it holds the series of higher lows in place, and therefore holds the uptrend in place.  Until that break occurs, I will continue looking for higher levels in the stock market.

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 PLEASE NOTE: THIS IS JUST AN ELLIOTT WAVE ANALYSIS BLOG AND IN NO WAY GUARANTEES OR IMPLIES ANY PROFIT OR GAIN. THE DATA HERE IS MERELY AN EXPRESSED OPINION. TRADE AT YOUR OWN RISK.

Elliott Wave Index Futures

I reworked the count a little bit to make it fit better with the degree of trend most likely playing out. I am counting the pullback today as a small wave (ii) correction which should be reaching an end soon. Once that is complete, the market's strong upward move should continue.

PLEASE NOTE: THIS IS JUST AN ANALYSIS BLOG AND IN NO WAY GUARANTEES OR IMPLIES ANY PROFIT OR GAIN. THE DATA HERE IS MERELY AN EXPRESSED OPINION. TRADE AT YOUR OWN RISK.