GroundStone Holdings Morning Newsletter and Daily Macro View
Find out all free news on:
https://www.groundstoneholdings.com/trading-news/
Find out all free news on:
https://www.groundstoneholdings.com/trading-news/
Website to view daily currency range for all pairs 1 reply
Article in Trading Game Newsletter - good read 4 replies
Any Good newsletter 3 replies
what's your daily morning research routine before trading? 15 replies
Innerworth Newsletter 1 reply
ADP employment data misses, but labor market remains healthy. Today’s ADP employment report showed U.S. firms added 179k jobs in November, below consensus estimates of 195k, and signals that job growth in tomorrow’s November nonfarm payrolls report could fall short of the forecasted 190k increase. Meanwhile, a separate report showed initial claims for unemployment benefits fell to 231k last week but has trended higher over the past few weeks. While lower-than-expected payrolls growth and an uptick in claims may sound worrisome, investors place more emphasis on the nonfarm payroll data, and job creation levels >150k amid a very tight labor at this point in the cycle remains encouraging.
Global manufacturing divergence widens. The latest batch of global manufacturing surveys for November indicate the U.S. has strengthened its lead in terms of manufacturing health. The U.S. measures are highest (mid-to-high 50s) and held firm or accelerated last month-depending on the source-while China’s measures are at 50, the breakeven between expansion and contraction, and Europe’s measure, at 51.8, has fallen to near two-year lows. Overseas economies may benefit from fresh stimulus at some point and/or potential trade deals, but for now the U.S. economy remains the standout performer globally and remains our preference to focus asset allocations.
EM resilience. Since the September 20 peak in the S&P 500, as of December 4, the MSCI Emerging Markets (EM) Index has lost just 1.9%, much better than the 7.5% loss in the S&P 500 during that period. The developed international equity benchmark MSCI EAFE Index has fared slightly worse than the S&P 500 with a 7.8% decline. Despite this week’s confusion around what China has agreed to in trade negotiations, we view recent EM outperformance as a reflection of the market’s optimism that a deal will come into view before too long.
Daily Macro View
The resulting pitchfork will resemble a rising channel in a bullish impulsive move, or a falling one in a bearish move. The distance between the ML and the other two lines in the pitchfork is always the same, as the ML stays at 50% distance. It means that the channel is basically split into two equal parts. In an impulsive wave, no matter whether a bullish or a bearish one, it is very difficult for the price to go much further than the ML. This is because in a bullish pitchfork, the price will rarely reach the UL, but will settle for the ML. By the time the ML is reached, look for the third wave in the impulsive wave to be completed, providing the extension rules are respected.
Pitchfork with Corrective Waves
The same thing is valid when it comes to corrective waves under the Elliott Waves theory, with the difference that the three pivot points that make up the Andrew’s Pitchfork are placed as follows:
ADP employment data misses, but labor market remains healthy. Today’s ADP employment report showed U.S. firms added 179k jobs in November, below consensus estimates of 195k, and signals that job growth in tomorrow’s November nonfarm payrolls report could fall short of the forecasted 190k increase. Meanwhile, a separate report showed initial claims for unemployment benefits fell to 231k last week but has trended higher over the past few weeks. While lower-than-expected payrolls growth and an uptick in claims may sound worrisome, investors place more emphasis on the nonfarm payroll data, and job creation levels >150k amid a very tight labor at this point in the cycle remains encouraging.
Global manufacturing divergence widens. The latest batch of global manufacturing surveys for November indicate the U.S. has strengthened its lead in terms of manufacturing health. The U.S. measures are highest (mid-to-high 50s) and held firm or accelerated last month-depending on the source-while China’s measures are at 50, the breakeven between expansion and contraction, and Europe’s measure, at 51.8, has fallen to near two-year lows. Overseas economies may benefit from fresh stimulus at some point and/or potential trade deals, but for now the U.S. economy remains the standout performer globally and remains our preference to focus asset allocations.
EM resilience. Since the September 20 peak in the S&P 500, as of December 4, the MSCI Emerging Markets (EM) Index has lost just 1.9%, much better than the 7.5% loss in the S&P 500 during that period. The developed international equity benchmark MSCI EAFE Index has fared slightly worse than the S&P 500 with a 7.8% decline. Despite this week’s confusion around what China has agreed to in trade negotiations, we view recent EM outperformance as a reflection of the market’s optimism that a deal will come into view before too long.