Friday, April 23, 2010

MTU Weekend Ed. - Targets for a Good Turn (4/23/10 Close)

In A Potentially Major Turning Point (4/9/10), I discussed wave counts that place the end of the rally from the early February lows as the end of the bear market rally (P2) in a diverse group of indices – foreign, domestic large cap and small cap. The highlighted indices are FTSE100 (Chart 1), SP500 (Chart 2) and Russell2000 (Chart 3).

Recent price actions suggest that the advances since the February lows in these indices are indeed in their late stages. Chart 4 to Chart 6 present my preferred count of the advance since the February lows. In terms of the wave structure since the February lows, FTSE100 and SP500 have extended third waves and Russell2000 has an extended fifth wave. I also offer the following projected targets. Given the market and sentiment internals, the market could very well turn below these levels.

FTSE100 – I mentioned that FTSE100 has less than 5% upside potential from the 4/9/10 close of 5770.98. It reached as high as 5833.73 on 4/16/10 and closed at 5723.65 this Friday, not far from the 4/9/10 level. The original cap on FTSE100 remains applicable.

SP500 – [v]=[i] at 1218.46 and [v]=1.618[i] at 1239.95.

Russell2000 – [v]=1.618[i to iii] at 753.34

Appendix - squiggles reveal a bunch of threes.

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