The Mars Market Update — Live Research

Just a brief update as we are now within striking distance of important upside targets for SPX, DJIA and EUR/USD. While the SPX and DJIA are on the verge of new ATH's, many other markets are lagging including the Banks, higher beta indices and peripheral equity markets. The generals continue to charge up the hill while the soldiers refuse to fight (a leader without followers is just a guy taking a walk). This fractured market tells me that the equity market rally is nearing its end. The SPX...

Last week's price action in global equity markets was telling. The key from an EW perspective is that for the last month we have seen nothing but overlapping 3 wave moves in both directions. This is the signature of a bull market that is exhausting. Of particular note are the wedging patterns forming on the SPX and DJIA which are ending structures. The 3 wave decline from the ATH's also suggest we need one more new ATH to complete this ending diagonal terminal pattern. There is a reason I have...

With minimum downside objectives met, I have covered half of my short GBP/USD @ 1.5501 (+131 pips) The reason I covered the remainder of my short GBP/USD position is that the decline "looks" like an impulsive a - triangle b - impulsive c down to the 0.382 retracement of wave 3 (measured objective) and subsequent impulsive rise. When in doubt, get out... hope is not a strategy. See below Seeing a similar potential triangle 4th wave setup in the EUR/USD (black count) Lesson Learned: Don't "lose...

Equity markets reversed lower last night following a stronger Monday morning opening. The rise from the lows continues to look corrective and I continue to believe the SPX trades towards my target gap close of 1632. While the higher beta indices have outperformed (Nasduck and RUT), the majors have struggled (DJIA and SPX). I still like this count for the SPX... The DJIA looks particularly weak relative to other indices and hasn't been able to climb off the floor... Moment of truth here for the...

This is why I try to stop short term speculative trades in overnight illiquid equity futures markets. The stop runs are plentiful. I prefer FX markets due to deep liquidity and no natural Fed and investor bias. I prefer to trade equity futures during the cash session with deeper liquidity. Anyway, I have learned this lesson before... stops too tight, illiquid markets and not giving the trade enough room to move... the market ensures I pay for tuition, so here is another lesson.

Short GBP/USD at around the 50% retracement level of recent initial decline... What I'm seeing on the short term count... This is where we are now...

USD/JPY has achieved its minimum target of a new high above 98.65 so I have taken half profits here at 98.73 (+168 pips).  

The FOMC Minutes release caused a flurry of activity in all markets with the US$ gaining strength and equity markets whipsawing down - up - down. Where to from here... Well, the weekend update I posted provided a nice roadmap for the SPX which has held true (4th wave chop zone) and my 1632 gap close target remains valid. Last night's spike high (post FOMC minutes) reversed lower at prior 4th wave resistance while the MACD zero line has held all advances to date. The SPX suggests we need at...