The collision of global markets and social mood

Thursday, October 22, 2015

Thursday -- Draghi, EUR, B-Waves, Higher Targets

S&P E-mini Futures:
Overnight bounce, ripping.

Asia was mostly down last night though Shanghai was up. Europe has gone from mixed to green.

Investors seem to feel that Draghi delivered more hope and dreams of the QE variety today. But he said that "monetary policy should not be the only game in town." To me, this dovetails with other central bank comments that sound as if they're getting tired of throwing good money after bad.

However, FX disagrees, and is in "shoot first, question later" mode.

EUR hammered after Draghi comments and expectations of new stimulus.

CHF notably weaker. Risk On.

USD ripping.

Still look like they want more upside, lower yields. Down volume remains muted.

WTI crude bouncing. NG hit fresh lows with positive divergence on daily, weekly, and monthly charts. Interested in playing this for upside now.

Gold getting hit. Silver and copper higher with copper leading.

S&P Outlook:
The peak of two days ago was an odd place to start hedging. But as I saw price coming off the highs in s sloppy, non-impulsive manner, I began to shift my sights to the 200dma at the 2059 area and a possible fast move there.

In hindsight, I realize that I should have been more patient in that the decline was likely a small B-wave inside a larger B-wave. These are notoriously "sloppy" affairs, deemed "phonies" in Frost and Prechter's Elliott Wave Principle.

The pressure is still to the upside. Dips are to be bought. If price can accommodate lower, there are several levels that remain of interest to me, 1945 being the best.

I will add another higher target in addition to the 200dma: the 78.6% retracement of the move from the May highs to the August lows. It sits at 2077.43. B-waves love to hit those.

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