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THE NAVIGATOR Stocks - ‘Re-Synchronisation’ | Life after Brexit - STLG

STOCK INDICES - This month’s Elliott Wave Navigator takes a look at the progress of Developed and Emerging Markets since ‘Re-Synchronisation’ of the secular-bull uptrend occurred last February. Whilst benchmark indices such as the S&P 500 and the MSCI Emerging market index have since unfolded higher into five wave impulse patterns to confirm this renewed uptrend, some underperforming U.S. sectors, European and Asian indices has correspondingly unfolded into three wave counter-trend patterns. That suggests their 2015 counter-trend declines remain incomplete, requiring an additional but final decline below the Feb.’16 lows. In some cases, indices would be forecast lower by -24% per cent. That would equate to the S&P 500 trading lower in synchronisation by -15% per cent. This report examines those three wave indices in order to determine this downside risk for the next few months.

CURRENCIES – Life after Brexit has been difficult for Sterling/British Pound with the key rate against the US$ dollar slipping below 1.3000 again. Of 31 currencies being monitored by Bloomberg, Sterling/British Pound is currently the weakest – by contrast, the Brazilian Real is the strongest. This report takes a look at each against the US$ dollar but also against each other in a new addition to our cross-rate analysis. The results indicate that Sterling/British Pound is approaching an important low, so contrary to consensus, has limited downside potential at this late stage of its decline. We also take a look at Stlg/Yen for verification as the Yen is the second strongest currency on the 31 member list. The Euro/US$ dollar is also updated although this can be seen trapped inside its multi-year trading range.