A Potentially Perilous Next Few Months

I haven't been showing longer term charts for a while because I didn't want people getting too bearish too soon.  I'm still not going to post the charts, but I will describe more specifics about the picture they are painting.  In essence, Weekly and Quarterly scale data are showing where sentiment would have the market (per the MarketMood Indicator) to be about 11% below where it is currently.  Monthly scale data is somewhat more bearish than that.  As I've mentioned previously on ElliottWaveTrader.net, there are similarities in the mood pattern for July-September to early 2020 in that it suggests a global "crisis mode."  There is still not a definitive shorting signal in the daily data, the intermediate term trend is still showing as fully bullish and the long term trend as strong bullish.  Yet, the mood pattern into the weekend is suggesting the potential for a crisis type of mentality.  It isn't clear as it's "on the line" (thus no MMI call for Friday and Monday RTH open), but this weekend has the potential to provide a first glimpse into what this may be about.

MMI is best on timing and only gives rough estimates for price.  That is one reason why it's a great compliment to Elliott Wave analysis which is best at price.  Please do not take the charts' estimate of 11% as a prediction of exactly how far the market will drop by early Fall of this year.  The best course would be to take this information in conjunction with what the superb Elliott Wave analysts on the site are looking for as targets as the anticipated pullback begins to unfold.  With the added benefit of fib pinball, which I believe is only found on EWT, you should have plenty available to make well informed trading decisions in these uncertain times.

Dr. Cari Bourette is an analyst at ElliottWaveTrader.net, where she provides her proprietary market mood analysis in our flagship service, "Avi's Market Alerts."