ELLIOTT WAVE ANALYSIS - Latest Market Commentary
Stock Indices
30th March 2023 - There’s been several attempts by central bank officials to dispel any contagion effect and spill-over from the recent banking failures in the U.S. and Switzerland, but Elliott Wave analysis ###shows a clear path lower for the major stock indices over the coming months, suggesting more trouble ahead. Earlier today, Philip Lane, member of the Executive Board of the ECB and chief economist explained that the EU banking system is healthier than before the financial-crisis of 2007-08 and that it’s unlikely the EU banking system will see similar collapses as those of the regional U.S. banks or the likes of Credit Suisse – brave words! Since the market has come to believe the latest banking turmoil has settled down and central banks are coming to the end of their interest rate hiking cycle, the noticeable outperformer for the last couple of weeks has been technology stocks. The Nasdaq 100 pushed slightly above February’s high last week, confirming October’s advance is a five wave ending-type diagonal pattern that is approaching upside completion – it requires another push … Read full summary in our latest report!
Currencies (FX)
30th March 2023 - The US$ dollar index completed a short-term corrective downswing from the early-March high of 105.88 into last week’s low of 101.92 and is now turning higher to resume February’s multi-month ###counter-trend rally. This dollar rally is simply a correction to last year’s five wave impulse decline from 114.78 ending at 100.82 – there’s a lot more dollar buying before upside completion, which suggests the dollar is attracting safe-haven buyers in an environment of a weakening global economy and a declining stock market. The Euro/US$ has completed its inverse upside rally to 1.0931 last week and has since begun to pull lower, resuming its counter-trend decline that began from February’s high of 1.1035. Stlg/US$ is equally expected to resume lower... Read full summary in our latest report!
Bonds (Interest Rates)
30th March 2023 - In the aftermath of last week’s Federal Reserve rate hike, much has been debated on whether there will be any more rate hikes during this current cycle. The banking sector has undergone a major### fallout with the insolvency of Silicon Valley and the rescue of First Republic Bank – also the rescue of Credit Suisse in Switzerland. Almost certainly, the first-round of the medium-term rate-hike cycle is approaching completion but there may yet be a surprising, unexpected twist. Whilst US2yr and DE2yr yields have almost certainly topped out, the US10yr and DE10yr yields are still rising in an impulse uptrend that began from the pandemic lows. Corrections from the October/February highs are incomplete to the downside, but another 50bps decline for both … Read full summary in our latest report!
Commodities
30th March 2023 - Gold’s recent reaction lower from pre-determined upside targets of 2012.30+/- from an actual high of 2009.80 has increased the probability that intermediate wave (1)’s entire five wave impulse ###uptrend from September’s low has completed. This seems most probable because the US$ dollar index has just completed its inverse corrective downswing from March’s high and is already turning higher to resume February’s larger corrective upswing. Silver nudged slightly higher last Friday to 23.56 but it has since been unable to push any higher this week. This is most probably because it’s finishing a counter-trend zig zag rally from the early-March low of 19.87 as minor wave b. within intermediate wave (5)’s zig zag downswing that began from February’s high of 24.67. That’s bearish across the next month or two, targeting modest lower lows, slightly below last September’s low of 17.54. Oil prices continued to climb higher for a third consecutive day after industry data showed a surprisingly large draw-down in U.S. crude stocks, pointing to tighter supply in the near-term. U.S. crude oil inventories fell by just over 6 million barrels in the week ended on March 24, ... Read full summary in our latest report!
