The iShares FTSE/Xinhua China 25 Index (FXI), after the pullback from yesterday's high at 41.08 into this morning's low at 40.68, appears ripe for upside acceleration. It appears to be consolidating between 41.00 and 40.70, and the price action has the right look of a bull flag continuation pattern prior to a thrust to the upside into my next optimal target zone at 41.50/80. Only a break of today's low at 40.68 will compromise the bullish near-term pattern, which will give me reason to bail out of the long side of the FXI.

SPX 10 Minute

Thanks RP for the charts!  Nice work as always.  p.

The BIG picture of the SPDR Gold Trust (NYSE: GLD) continues to exhibit a series of higher lows and higher highs since the March 24 low at 106.34. My near-term work argues that the decline from new all-time highs at 122.45 to yesterday's low at 118.83 represents yet another pullback to a higher low. If, indeed, a minor correction was completed yesterday, then a new upleg is in progress that should propel the GLD to higher all-time highs that projects next into the 125-26 zone. Although my protective stop at 118.70, just beneath yesterday's low, is very tight, my near-term work indicates that if yesterday's low is violated, additional weakness will be forthcoming.

This includes some targets from AFT.

It's okay.  Really.  I still love you all.  p.

Yes, he did.  His SPX target was 1035-1048 if my memory is right.  Hummmm....not too far below where we are right now.  Prechter also went bearish in November 2008 and bullish in early April 2009 and his call on the dollar last November was stellar.   p.

I'm an unabashed Prechter fan!  The last time he was on with Maria, he called it perfect.  The April top was almost in or was in.  And his newsletter provided that cover of the magazine last night.  He's the man.  p.

Based on the declining wave structure from the end of wave 4 at 1.2328 on June 3, the [Euro]likely has one more leg down to beneath 1.1876 (Jun. 6) before a low is in place. But, as we've been discussing, the entire decline from the November 2009 top at 1.5147 is very late in development.  Besides the nearly complete wave pattern, the Daily Sentiment Index has had three consecutive days of below 10% euro bulls (trade-futures.com), confirming the extreme pessimism of mid-May. Equally, if not more important, the euro's "demise" just landed on the cover the recent issue of Newsweek. According to Paul Macrae Montgomery's Magazine Cover Indicator, by the time a financial market makes it to the cover of a popular news weekly, the current trend of said market should be near exhaustion, which implies an impending reversal.

British Petroleum (NYSE: BP) and Transocean (NYSE: RIG) have created a bit of a Lehman feel to the markets today. Ironically, oil prices are rocketing.  BP has plunged to levels not seen since 1996! Whether or not BP is heading into bankruptcy is immaterial, because Mr. Market certainly thinks so.As for the market as a whole, while Bernanke spoke to the House Committee, the S&P 500 clawed its way higher, with the emini rising from 1067 to nearly 1078, a 50% recovery of the entire decline from last Friday's peak at 1107.75 to yesterday's low at 1041.25. In and around the 1075 area, we should expect the index to encounter near-term technical selling pressure that stalls the upmove, if nothing else. The shallower the pullback, the more constructive and powerful the developing upmove, with 1070 and then 1064 as key intraday support for containing weakness ahead of a resumption in recovery strength -- if this upmove is real.

Very nice and while many folks had given up on the formation of that right shoulder, it's still in the possible scenario category, as you just showed.  Thanks Steve. p.

Here's a chart that has some excerpts from AFT last night.  p.

We need to send this "theory" to BP's defense attorneys.  It works for me.  p.

This chart includes GANN lines.  Wow what a nice day for JTVerr, our resident $RUT guru.  Thank you for charts.  p.

He's right.  It is a thing of beauty.  p.

The new red light, blue light and green light is terrific.  Thanks Steve.  p.