INDICATORS: THE COMPARISON BETWEEN THE JAPANESE NIKKEI INDEX IN THE 1990'S TO THE
U.S. NASDAQ COMPOSITE INDEX. LOG SCALE PERCENTAGES AND ABSOLUTE VALUES.
POSTED 3/11/2004: UPDATED 8/20/04
While the approximate comparison between these
two indexs may have no real value, enough traders have brought up this similarity
over the last two years that I think it's a good idea to keep it in the back
of our minds. While I still expect the Nasdaq to make it's final Bear Market
low in 2006, and a higher low in 2010 or 2014, that is far from a done deal
even though it "fits" my model perfectly.
My opinion is that the Nikkei is doing a Elliott Wave Grand Super-Cycle wave
four, while the U.S. Nasdaq is doing a Grand Super-Cycle wave two, so I don't
expect this comparison to hold water for much longer,
and with that break at the January 2004 top, in the Nasdaq, which would
have been a deep low if following the Nikkei, that disconnect may already
be in place. This next graphic shows that better then the larger charts
at the bottom, and it was just updated on 8/20/4.
Never the less, I will say that the Nikkei pattern sure fit's the general
form I would expect for the SPX index, and somewhat like the pattern I expect
for the DJIA, since I think they are both doing wave fours also, but of one
lesser degree then the Nikkei. That is to say, I think the SPX and DJIA are
doing a wave four of Super-Cycle degree, while the Nikkei is doing a Grand
Super-Cycle degree wave four.
Of course, none of this is cast in stone anywhere, and it's still a little
early to even place some probabilities to it.
FOR THE PRICETIME REVIEW
A.J. QUIGGLY
