Market Turning Points Newsletter

April 3, 2011 Week-end report By Andre Gratian Precision timing for all time frames through a 3-dimensional approach to technical analysis: Cycles - Breadth - P&F and Fibonacci price projections “By the Law of Periodical Repetition, everything which has happened once must happen again, and again, and again -- and not capriciously, but at regular periods, and each thing in its own period, not another's, and each obeying its own law … The same Nature which delights in periodical repetition in the sky is the Nature which orders the affairs of the earth. Let us not underrate the value of that hint." -- Mark Twain Current position of the market Very Long-term trend – The continuing strength in the indices is causing me to question whether we are in a secular bear market or two consecutive cyclical bull/bear cycles. In any case, the very-long-term cycles are down and, if they make their lows when expected, there will be another steep and prolonged decline into 2014-15. Long-term trend - In March 2009, the SPX began an upward move in the form of a bull market. Cycles and P&F projections point to a continuation of this trend for several more months. SPX: Intermediate trend – The intermediate trend is still up and does not look in immediate danger of reversing. A short-term correction appears to be complete, but there could be a pull-back before moving higher. Analysis of the short-term trend is done on a daily basis with the help of hourly charts. It is an important adjunct to the analysis of daily and weekly charts which discusses the course of longer market trends. Daily market analysis of the short term trend is reserved for subscribers. If you would like to sign up for a FREE 4-week trial period of daily comments, please let me know at ajg@cybertrails.com Market Overview A Point & Figure chart is the simplest way to keep track of stocks and indices. The technique is over 100 years old, and one of its most valuable attributes is its ability to project prices. Once one has mastered it, a lot (but not all) of the uncertainty and guess work has been eliminated from technical analysis. Let's apply it to today's market to see where we are and where we could be going. Because I still don't have access to the complete data needed to establish valid counts of the 2009 base, I'll start by analyzing the accumulation which occurred during the 2010 intermediate correction of the SPX. The entire count for this base gives me a projection to 14xx already established from a lower level level. Now, let's see what we can derive from the recent re-accumulation pattern. On the 1X1 chart that I now keep by hand, I can take valid counts from four different levels to determine where the SPX is likely to go before making a significant reversal. The first and most conservative one, taken across the 1258 level, has a projection to 1334. Others, taken from 1268, 1278, and 1286, yield higher projections, with the last one closely matching the 14xx target mentioned above. These price targets will be made available to subscribers in daily updates. Based on the interpretation of a P&F chart, each separate count should represent the completion of a market phase and be followed by a correction, with the final count ostensibly marking the end of the intermediate trend which started at 1041. If higher counts can be derived from the 2009 base, 14xx will not be the end of the bull market. The above gives the trader/investor a basic framework for future market moves which should be substantiated by other modes of technical analysis. Let's begin this process by looking at some charts. Chart Analysis This weekly newsletter regularly analyzes the SPX, the Dollar, Gold and oil, as well as breadth and sentiment indicators. To read the current newsletter in its entirety, please go to: www.marketurningpoints.com Click on “Newsletters” Andre