618034 Ltd 13 April 2015 1

Technical Insight Weekly review

13 April 2015

Technical Analyst: Paul Nesbitt (CFTe, MSTA) Telephone: 020-8133-0382

618034 Ltd 13 April 2015 2

Contents

Page Number Description

3 Macro Summary

4-10 Global Equity Markets

4 Dow Jones EuroStoxx 50 Index

5 DJ EuroStoxx 600 Index

6 Germany DAX Index

7 S&P 500 Index

8 Nasdaq 100 Index*

9 FTSE100 Index

10 Nikkei 225 Index

11 Hang Seng Index

12 Philadelphia Gold & Silver Index

13-14 Fixed Income

13 US 10 Year Yields

14 Bund 10 Year Yields

15-19 Foreign Exchange

15 Trade Weighted US$ Index

16 Euro vs. US Dollar

17 US Dollar vs. Japanese Yen

18 Sterling vs. US Dollar

19 A$ vs. US Dollar

20-22 Commodities

20 CRB Continuous Commodity Index

21 Crude Oil (WTI)

22 Gold (Comex)

23-33 S&P Global Sector Relatives

23 Summary

24 Consumer Discretionary

25 Consumer Staples

26 Energy

27 Financials

28 Healthcare

29 Industrials

30 IT

31 Materials

32 Telecoms

33 Utilities

*Guest

618034 Ltd 13 April 2015 3

Summary

Equity Markets

Most Equity Markets appear to be in territory where a high is likely in the coming week. However many of these expected corrections are within the context of ongoing bull market trends particularly in European Indices.

Bond Markets

Bond yields have drifted lower particularly in Europe. The trend is still down.

Currencies

The Trade Weighted US$ Index has benefitted from a significant bounce but may still need some further consolidation before it has the energy to continue to new highs. The Pound has been on the back foot and may still have some further downside before a meaningful rally gets under way.

Commodities

Commodity Indices remain in an historic bear market but may be trying to turn the corner. A weaker US$ might help. Crude Oil had a good bounce with Brent holding up better than WTI. Precious Metals are enjoying a bounce.

Sectors

No real standouts this week. Energy held on well but may be under pressure from here. The Consumer may be keeping his hands in his pocket.

618034 Ltd 13 April 2015 4

Euro Stoxx 50 Index

Source 618034 Ltd

The EuroStoxx 50 Index may be close to completing wave 5 within the larger degree wave (3) rally. Any set back from here should find support from the rising 50 day moving average and test the prior wave 4 low (36168).

Key Points

Still trending higher but correction now due.

618034 Ltd 13 April 2015 5

Euro Stoxx 600 Index

Source 618034 Ltd

The Euro Stoxx 600 Index has finally made it into new all time high territory and now may be close to completing the internal wave [v] rally to form the major wave (3) high. Then a correction back to test the prior wave 4 low (390.65) can be expected. The rising 50 day moving average may lend support.

Key Points

Correction now pending.

618034 Ltd 13 April 2015 6

German DAX Index

Source 618034 Ltd

The German DAX Index may be close to completing wave [v] within the larger degree wave (3) rally. A correction back to the rising 50 day moving average to test the prior wave [iv] low (11619.7) can be expected to get under way soon.

Key Points

Correction pending.

618034 Ltd 13 April 2015 7

S&P 500 Index

Source: 618034 Ltd

The S&P500 Index really needs to continue higher and make new highs. A failure to do so could create a triple top pattern which is not encouraging. The rising 128 day moving average is a long term supporter and needs to remain in control.

Key Points

At resistance.

618034 Ltd 13 April 2015 8

Nasdaq 100 Index

Source: 618034 Ltd

The Nasdaq 100 Index has formed an abc pattern to possibly complete a wave 4 correction in the 38% to 50% retracement zone (4281.41-4329.21). In this event wave 5 is expected to achieve a minimum of 4539.19. Near term the 78.6% retracement level (4436.03) may stand in the way.

Key Points

Possible barrier just ahead.

618034 Ltd 13 April 2015 9

FTSE 100 Index (Daily)

Source: 618034 Ltd

The FTSE100 Index is now making new all time highs and should achieve a minimum of 7146.70 and ideally 7250.50 if not higher. The former ceiling around 6950 should then become a floor.

Key Points

New all time high!

618034 Ltd 13 April 2015 10

Nikkei 225 Index

Source: 618034 Ltd

Despite achieving the major wave [3] target at 19689.7 the Nikkei 225 Index still had its eyes set on achieving the big round number. It has now achieved the minimum wave 5 target at 20006! A correction back to test the prior wave 4 low (18927.9) should get under way next week.

Key Points

Wave 5 of (5)?

618034 Ltd 13 April 2015 11

Hang Seng Index

Source: 618034 Ltd

The Hang Seng Index has had a stunning break above the high made in September 2014 and has tagged a major 78.6% retracement level. This is the final barrier to new all time highs. Near term a correction should put in a low above the prior high (25363).

Key Points

New highs achieved!

618034 Ltd 13 April 2015 12

Philadelphia Gold & Silver Index

Source 618034 Ltd

The Philadelphia Gold & Silver Index (XAU) formed an outside reversal day on the 11th March at the October 2008 low (63.52) to form what may turn out to be a major triple bottom. However further weakness from here would be very bearish as 4th attempts generally succeed.

Key Points

Head & shoulders pattern with weak right shoulder?

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US 10 year yields

Source 618034 Ltd

US 10 year yields may have completed an abc corrective rally which stalled at the 78.6% retracement level (2.245%). The price action in the coming days will reveal whether the trend is still down or we are in the early stages of a major ABC rally.

Key Points

Bullish pattern for yields?

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Euro 10 Year Bund yields

Source 618034 Ltd

It is just possible we have seen a wave 5 of wave [v] of wave {5} low in Bund 10 Year yields. However rallies remain capped by the falling 50 day moving average. Until yields can overcome this barrier the trend remains down.

Key Points

Possible low?

618034 Ltd 13 April 2015 15

Trade Weighted US$ Index

Source 618034 Ltd

The Trade Weighted U$ may have completed its correction with the rising 50 day moving average providing support. In this event the 78.6% retracement level (99.487) will not be a problem and new highs are just a day or two away. In the event that the 78.6% retracement is a problem then support at the rising 50 day moving average will be called upon once again.

Key Points

Correction under way.

618034 Ltd 13 April 2015 16

€uro vs. US$

Source 618034 Ltd

The Euro has achieved the ideal projection ($1.0473) to complete the wave [iii] low. However the rally from this low has failed to overcome the falling 50 day moving average but it is unlikely that the correction from the low is complete. The 78.6% retracement level ($1.0585) should stop the decline and support a move higher to $1.1162.

Key Points

Sell off low?

618034 Ltd 13 April 2015 17

Yen per US$

Source 618034 Ltd

The US$ appears to be forming a corrective ABC pattern versus the Japanese Yen. The 78.6% retracement level (Y117.18) may limit the downside.

Key Points

Momentum lagging.

618034 Ltd 13 April 2015 18

Pound vs. US$

Source 618034 Ltd

The Pound has continued lower into the broad support zone versus the US$ which should form a major wave [iii] low. It is possible the low formed in May 2010 ($1.4245) is in the frame before a significant bounce gets under way.

Key Points

Still trending lower?

618034 Ltd 13 April 2015 19

A$ vs. US$

Source 618034 Ltd

It is still not clear that the A$ has formed a low versus the US$. Once the falling 50 day moving average is overcome we can then expect a meaningful rally to get under way.

Key Points

Capped by the falling 50 day ma.

618034 Ltd 13 April 2015 20

CRB Continuous Commodity Index

Source 618034 Ltd

The CCI CRB Index may have completed an historic bear market! The major 78.6% retracement level (401.42) is the last line of support! Early signs of a turnaround? Still too early to call. The falling 50 day moving average continues to cap the upside.

Key Points

Reversing?

618034 Ltd 13 April 2015 21

Crude Oil (WTI)

Source 618034 Ltd

Despite not achieving $40.68 it is possible that Crude Oil (WTI) may have formed the wave [v] low. In this event the pattern of rising lows above the rising trend line is very encouraging.

Key Points

Support at rising trend line.

618034 Ltd 13 April 2015 22

Comex Gold

Source 618034 Ltd

Comex Gold declined and tested the prior lows before reversing higher. The relief rally may have tested the prior wave [iv] high ($1223). A higher low may now be in place but the falling 50 day moving average may continue to have an influence.

Key Points

Rally under way.

618034 Ltd 13 April 2015 23

S&P Global Sector Relatives Sectors Outperforming the S&P Global Index

HealthCare

Consumer Discretionary

IT

Sectors performing in line with the S&P Global Index

Consumer Staples

Financials

Industrials

Sectors Underperforming the S&P Global Index

Energy

Telecoms

Materials

Utilities

Summary

No real standouts this week. Energy held on well but may be under pressure from here. The Consumer may be keeping his hands in his pocket.

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Consumer Discretionary

Source 618034 Ltd

Positive: Consumer Discretionary spending has paused once again. Maybe some saving is taking place.

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Consumer Staples

Source 618034 Ltd

Neutral: Consumer Staples has bounced as expected to allow overweight holders to reduce exposure. Some consolidation from here will provide evidence regarding the future trend.

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Energy

Source 618034 Ltd

Negative: The Energy Sector has had a healthy bounce but may struggle to go better from here. A resumption of the downtrend may be on the cards.

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Financials

Source 618034 Ltd

Neutral: The Financial Sector gave back some of the recent gains but should now consolidate its position in the middle ground.

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Healthcare

Source 618034 Ltd

Positive: Healthcare has recovered its breath and resumed its trend higher.

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Industrials

Source 618034 Ltd

Neutral: The Industrials Sector is enjoying a relief rally as expected which should allow overweight holders to reduce exposure.

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Information Technology

Source 618034 Ltd

Positive: The IT Sector remains at risk of being demoted. Overweight holders might consider reducing exposure.

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Materials Index

Source 618034 Ltd

Neutral: The Materials Sector had a brief bounce but has since drifted lower.

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Telecom Services

Source 618034 Ltd

Negative: The Telecom Services Sector has resumed its trend lower.

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Utilities

Source 618034 Ltd

Negative: The Utility Sector enjoyed a good bounce from a severely oversold position. The nature of the consolidation under way will confirm if a low is in place.

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Disclaimer

The technical comment attached hereto (the Technical Comment) has been prepared by 618034 Limited (the Company) and represents the Company’s commentary on the financial markets based on its interpretation of ‘Elliott Wave’ theory combined with ‘Fibonacci’ price projections and retracements. The Technical Comment has been prepared for general information purposes for professional and business investors. No reliance should be placed on any statements, opinions, judgements, conclusions, or otherwise, contained in the Technical Comment because by their very nature they are subject to a number of risks and uncertainties and will be affected by a number of factors, and any such statements, opinions, judgements, conclusions or otherwise are subject to change by the Company without notice. Without limitation the Technical Comment should not be regarded as a recommendation to take or refrain from taking, any particular course of action, including, a recommendation or solicitation to buy or sell any kind of financial instrument or security. Facts stated and estimates and opinions given in the Technical Comment have been obtained from or are based upon sources believed by the Company to be reliable but no guarantee is given by the Company to that effect. No representation or warranty, express or implied, is made nor responsibility nor liability of any kind accepted by the Company or any of its personnel as to the accuracy, completeness, correctness, current relevance, or otherwise of the Technical Comment and/or any of the information contained in it. The Technical Comment has been prepared solely for the person to whom it is addressed and not for any other person and as such must not be relied upon by any other person for any purpose whatsoever. The Company reserves all rights in the Technical Comment and its contents. Neither the Technical Comment nor any part of it, may be copied, altered in any way, transmitted to, and distributed to any other party, without the prior express written permission of the Company. This Disclaimer sets out the Company’s entire financial liability (including any liability for the acts or omissions of its employees, agents, consultants and sub contractors) in respect of the Technical Comment. All warranties, conditions and other terms implied by statute or common law are, to the fullest extent permitted by law, excluded. The Company shall not under any circumstances be liable for, (i) loss of profits; or (ii) loss of business; or (iii) depletion of goodwill and/or similar losses: or (iv) loss of anticipated savings; or (v) any special, indirect consequential or pure economic loss, costs, damages, charges or expenses. The Company’s total liability (including any liability for the acts or omissions of its employees, agents, consultants and subcontractors) in contract, tort (including negligence or breach of statutory duty), misrepresentation, restitution or otherwise arising in connection with the Technical Comment shall be limited to £100,000. Nothing in this Disclaimer limits or excludes or purports to limit or exclude the Company’s liability in respect of fraud or fraudulent misrepresentation. If any provision of this Disclaimer (or part of any provision) is found by any court or other authority of competent jurisdiction to be invalid, illegal or unenforceable, that provision or part-provision shall, to the extent required, be deemed not to form part of the Disclaimer, and the validity and enforceability of the other provisions of it shall not be affected. If a provision of this Disclaimer (or part of any provision) is found illegal, invalid or unenforceable, the provision shall apply with the minimum modification necessary to make it legal, valid and enforceable.