Thursday’s trade was awesome the first hour, slow and thick for the next 4 hours and smashed lower after the close. AMZN reported earnings of $111 billion for the 2nd quarter, which blew Google’s numbers out the door, but the forward guidance for 3rd quarter was $113 billion vs. $118 estimated. Well that tossed everyone’s cookies with the stock dropping over $100 immediately. As I write this update the stock is now down $230 from the close. The NQ is trading at 14930 down 82 on the day. Ok, so what does all of this suggest for the current Elliott count and tomorrow’s trade? Actually it doesn’t change anything. I am still looking for a ‘C’ wave down which was delayed until the close. The NQ initially rallied strongly reaching yesterday’s high and then some. Once that was completed the NQ basically sat in a range under lite volume. As I write this update the market is breaking below the hourly 200 MA but is managing to hold it for now. Also of note, the Daily 8 MA is at 14931 with the market sitting right on top of it. A break below that level would turn the hourly chart negative along with the hourly. That does bode well for the ‘C’ picking up some additional steam and heading lower. First support to complete the move remains at 14711. But remember, structure rules over price in that I am looking for a 5 wave structure down. Therefore, I would be looking for a slide into support levels starting at 14625, 14572 and 14486. With the intensity rising significantly be careful to follow your moving averages for entry and exit levels. The decline will likely be swift and hard, but so will the bounces. So keep an eye on the moving averages. Ultimately, unless a break below 1444o happens additional upside and new highs would remain in the near term picture.
July 29, 2021