Thursday, April 8, 2010 EST
FER Value of the Market

Ford Equity presents market forecast by DK Technicals

In our final Weekly Review for 2009, we sketched out what we believed was the most likely projection for the SPX in 2010 and we reproduce that chart at the top of this page.  The bold line was our preferred trajectory for the index but it didn’t work our as we expected.  The index did see a sharp decline from a January peak and it did post a meaningful low around our February 4th turn date (actually on Feb. 5th) but it was not nearly as deep as we expected.  Also, the ensuing bounce carried to new recovery highs, which although we made allowances for it, was not what we expected.  This brings us to the alternate scenario whose initial stages were sketched out by the broken chart line.  So our best projection now is that the SPX is heading for an April 5th peak that is likely to roll over into an interim low around May 28th.  We’ve given a target for that peak around the 1228 area, which is the 62% retracement level from the ’07 highs.  Whether that target is attained within the time allotted is unclear but we would place more emphasis on the turning point provided by the cycle date than the actual price target.

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