ES Daily Candle: Higher High, Lower Low, Higher Close: Outside Candle Up
Market Posture: Neutral and Probing
Daily Swing Line: Up (Higher High, Higher Low)
Daily Bias: Up (Settle Above 18-day SMA)
Today, the FED lowered short term rates, the quarter-point, as expected. But, with the look of a scared puppy-dog, Chair Powell said this rate is "appropriate", and they removed some words that were previously signalling more rate cuts - meaning something like, "this is it, for now". But, then in the following news conference he answered a question stating (paraphrase), "if inflation does not increase, then there will be no rate hikes". This essentially meant, "we're on hold for now, but don't expect to normalize the balance sheet, or get any rate hikes without inflation". Wow. Welcome to Japan, Inc, USA.
Long before the FED announcement and meeting, and in continuation of the work done yesterday, we published a partial chart in the comments indicating that The Eight Fold Method was showing that an impulse upward on the hourly time scale was very, very possible. Here is the continuation of that chart at the futures settlement.
|ES - Hourly - The Eight Fold Path Method|
We published the chart when the lower lows of the day were in place, with about 134 candles on the chart, and EWO had just gone below the zero line but not by more than -40% of the peak value. (If you are not familiar with this method, please see the Featured Post on this blog).
You have to admit - when the market is impulsing - this method shows it quite well. When it is not, we then have to noodle what kind of non-impulse structure is taking place.
The Dow made a marginal local higher high today (not a new all-time high), and we wonder if it is not forming a diagonal instead of an impulse. While we will watch Facebook and Apple earnings with interest tonight, it is, as we said, possible that the minute ((a)) wave is extending from a diagonal to an impulse, as was discussed in yesterday's blog.
The fifth wave, ((5)), above, looks like it could use another wave series upward, and therefore may not be over yet. But, the invalidation of that would be any movement below ((4)).
Have a good start to the evening.