The Global Equity Markets.

Here are some extracts from a research article that I read today. =)

The End of the US Correction?

The S&P500 pulled back to 1,295 pts last Monday, within our 1,283-1,295 target range, before staging a strong rally towards the end of the week. This could be the start of the minor wave iii rally. However, we see signs of consolidation, at least in the first half of this week. But we would only turn bearish if the index broke below its mid-Mar low of 1,249. Otherwise, we continue to expect a major peak for the US equity market sometime between end-May and end-Jun. Pattern-wise, we see a potential bullish reverse “head & shoulder” formation with the neckline at 1,338pts and a target of 1,435pts on breakout of the neckline.

Asia's resurgence to continue in May 2011...

The MSCI Asia ex-Japan (MAxJ) corrected until midweek before rebounding to close strong at the week’s end. The strength of the rally at the end of last week is probably an indication of further upside for Asian stockmarkets over the next few weeks. This view is supported by MAxJ’s recent bullish weekly MACD “golden cross” confirmation and the breakout of the weekly RSI above its resistance trendline. However, we expect consolidation first for Asian equity markets this week as part of the rebuilding of support.

Weakness in Dollar Index continues...

Weakness in the Dollar Index continued last week, with the index reaching as low as 73.7pts. Until we see signs of a rebound in the Dollar Index, commodity prices could continue to rally in the face of weakness of the US$. However, a breakout above the 75 level would indicate the end of the Dollar Index’s downtrend from the Nov 10 peak.