News Vacuum ??

Next week brings only a paltry number of economic reports (Consumer Credit, Mortgage Applications, Wholesale Inventories, Initial Claims, Michigan Sentiment & Treasury Budget). These are not the typical block-buster reports that move markets - like a FED meeting, CPI, or a Payroll Report.

Then, too, although earnings continue to dribble in, many of the larger reports save Disney, Coke, Oxy & a few others, have already come out. So, a question might be if the market will simply trade higher on a lack of news.

ES Futures - Daily - Higher High

The current wave count certainly allows for some further upward movement. There are still more down days in the count than up days, and they could equalize more or even switch to become more up days, within limits.

We note that the price bias is up. And that should be respected until it is no longer. We also note the upper daily Bollinger Band has been dropping below the prior all-time-high and may provide some resistance on the way up. Then, too, there is a pretty significant resistance/support band between about 5,160 and 5,260. The daily slow stochastic is not yet over-bought.

However, if price rises further, then items to watch out for - while the U.S. is in a news dead zone - would be 1) economic news out of China or the Eurozone, 2) foreign currency movements, 3) geopolitical developments that were unanticipated, and 4) news from our banking system which isn't part of a standard economic or company report, including bank failures, etc.

Then, too, news alone does not have to make market swings. Other internal factors - like traders managing "sell May" strategies, or people going on vacation, etc. can affect the market mechanics. So, it is still wise to be cautious and patient in such an environment until the wave structure becomes clearer,

Have an excellent rest of the weekend,

TraderJoe