Europe long has lagged the U.S. since March '09 bottom. This is displayed via $DAX:$SPX relative performance. (Truth is we are hard pressed to find anything outperforming the S&P 500.)
Europe's lag can be seen supporting the likelihood $DAX is forming a "rising wedge" off early-October 2011 bottom. A rising wedge being a special Elliott wave indicating trend "exhaustion," this condition is substantiated by $DAX PPO (price percent oscillator: a momentum measure). The prospective Elliott wave count of this rising wedge's component waves is substantiated by $DAX:$SPX relative performance since early-October 2011. The rising wedge's 4th wave likely will be completed once $DAX:$SPX relative performance falls below its bottom coincident with formation of the rising wedge's 2nd wave (early-June 2012).
As for the U.S., $SPX reveals an Elliott 3rd wave's dynamism in formation of the two (c) waves labeled above. This is seen via $SPX PPO (circled). Yet exhaustion is seen here, too, contrasting the current (c) wave's PPO with the prior one largely unfolding over the latter half of 2010.
We might imagine everyone is conditioned to believe volume doesn't matter. I submit that, it does, and not only will it "matter," but its diminishing trend risks a dizzying tailspin. This possibly is heightened by a thinning bid principally captive to increasing selling restraint.
Anyone else notice during President Obama's press conference today a docile media worthy of being ignored? Talk about exhaustion. Like beating a dead horse, and this without a single question about an increasingly dire European situation! Could the Elliott wave views presented above suggest dead media horses, too, are near being buried? Odds sure look good, judging by the game of T-ball they otherwise called a presidential press conference.
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