CNBC EUROPE WEEKLY REPORT

LET?S LOOK AT THE FTSE 100 FIRST

Last week I said this index was in the start of a powerful move up that could reach the 5300 level and I briefly explained my reasoning for that forecast. I don?t see anything to change my mind. If you?ll look at the chart you?ll see there has been a vibration of 45 calendar days low to low. This vibration did not start here but started some time back in time. Whenever markets start to run 45 or 90 calendar days low to low. It sets up a possibility for a significant move up and a high if the market then goes up into one of those 45 or 90 day time periods. In this instance, those next to dates are 8^th of March and 22^nd of April. This trend should hold to normal or fast trend criteria and not correct back more than 4 trading days (a first degree counter trend) until the trend is complete. Remember, we don?t start that count until a daily low is broken. I can forecast, this index will not correct back more than 4 days at anytime within the next 30 days or possibly even the next 70 days depending how the index goes into the 8^th or 9^th of March. To those who follow my proprietary form of analysis - this was a large creeping trend that was resolved to the upside.

NOW LET?S LOOK AT THE S&P 500 INDEX

I?ve been saying the last low was a solid low. The only question in my mind is; will it stall at the old high or marginally above that high and start a choppy sideways pattern before the run to 1270 or will the index just go directly to the objective of 1260 to 1270? Don?t misunderstand me, it is going to that objective. I am just not sure of the form of trend it will take to get there. My forecast called for a choppy pattern after a test of this high, followed by an exhaustion move up. So far the only thing the index can do is show one day corrections or counter trends. So support for this index is definitely present. I am still not sure of the "Pattern of Trend" that will materialize up from here. Once the index gets up to this "obvious" resistance of the old high (only 12 points away), I should be able to forecast how this trend will be resolved. But for now, the move up shows no hesitancy with only one day counter trends in place.

02-14-2005A

CNBC ASIA REPORT

LET?S LOOK AT THE NIKKEI WEEKLY CHART FIRST

When the Nikkei and the Topix Indexes came down and showed the first higher low it was a solid indication the move down was complete and we could assume a move up to test the most recent old highs. If you will recall I said the "three thrust pattern down" indicated the completion of the move down and explained the pattern on your show. The index then tested the old highs and showed a higher low. I then forecast on your CNBC ASIA show that the Nikkei and of course the Topix Indexes would go up and test the April 2004 highs. That is still a significant move up from here and the price action on the daily chart has given us some very strong points of support to help confirm that probability.

LET?S GO TO THE DAILY CHART OF THE NIKKEI

Last week I indicated the move up was not a strong move and needed to hold all support levels that the trend had created. There was only one down day last week and that was a wide range, close on the low day or a capitulation of some sort. If that low is broken then my forecast is dead wrong. I?ve drawn a little horizontal line from the top of the last resistance. If that is broken it would be the first indication I could be wrong I doubt that will occur. But the last low is the critical support now. It still looks like a test of the 2004 high. To those who follow my proprietary analysis this past three weeks was a creeping trend up that was resolved to the upside and should now be a fast trend.

LET?S LOOK AT A WEEKLY CHART OF THE AUSTRALIAN ALL ORDINARIES INDEX

You can see for the past 6 months this index has been in a vertical ascent. As bullish as this appears, it is also an exhaustion leg up and the bull campaign will terminate when this current leg is exhausted. Last week the index hit the bottom of a resistance zone that I don?t believe this index will get through. The zone is almost a 100 point window, which for a technician like myself, is embarrassingly large. And as I?ve been say for the past many months, only an amateur or novice trader would consider getting on the short side of an exhaustion leg of a trend. All I?m suggesting, is it would be prudent to be aware of your long positions in this market over the next two months as I can see a lot of risk.

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