The only time the phrase “Reply hazy, try again later” is an acceptable response to a question is when you shake a Magic Eight Ball. Now consider these recent news headlines from the mainstream financial media: “Fed Signal Unclear,” “Economic Outlook Uncertain,” “Repercussions Unknown,” and “Stock Markets Remain Mixed.”
If that were the whole story -- the New York Stock Exchange trading floor would look more like a monastery than an ant hill that’s just been stepped on.
Point being: When the mainstream outlook is “unclear,” the clock of opportunity is still ticking. And, as the May 19 Short Term Update reveals, the Wake-Up alarm has just gone off in a very loud way. In STU’s own words: “This is the background in which we want to discuss Four Market Developments… and their implications.”
(These may be the hazy days of summer, but they are not the “Hazy” days of market analysis. The May 19
Short Term Update clearly sees not one, but FOUR indications that blue-chip stocks are set for a powerful move.
Learn More)
Below are actual excerpts from Short Term Update’s analysis of these four, trend-shaping events -- along with first-hand descriptions of the accompanying charts:
Volatility: Picture: Dow Jones Industrial Average vs. the CBOE Volatility Index over the past six months. Analysis: “[The VIX’s] track record, while not perfect, is very strong at pinpointing turns… Prices are days within a window for the start of a short-term decline.” The 500-plus point sell-off since then speaks for itself.
Put/Call Ratio: Picture: DJ Wilshire 5000 vs. 10-day Total Equity & Index Put/Call Ratio since July 2007. Analysis: “The depth to which the ratio has fallen suggests that the next leg will likely not be just a week or two affair, but something more substantial.”
Dow Theory Non-Confirmation: Picture: DJIA vs. DJ Transportation Average since January 2008. Analysis: “There is a glaring divergence between the two indexes. In order for this major non-confirmation to be resolved, the Dow Industrials would have to…”
Trendlines: Picture: DJIA labeled with two major trendlines, one of which goes back as far as 1982. Analysis: “The final and most important event that carries medium to longer-term market ramifications… We did not draw these trendlines, the market did.” If the market vaults above these resistance lines, it would be a bullish sign; if not, a bearish case will be made.
No question about it: Opportunity Awaits. And, with a risk-free subscription to our
Financial Forecast Service, you will receive instant access to both
Short Term Update and the May 2008
Elliott Wave Financial Forecast.
Learn More today.