Nice to know Martin Armstrong is looking at the same important levels in the S&P 500 and Dow Jones Industrials, now AND the long-term big picture

Martin Armstrong, who developed the Economic Confidence Model that we and others refer to from time to time, apparently is generating newsletters nowadays and apparently is seeing the S&P 500 and Dow Jones Industrial Average about the same way we're seeing them. Naturally we're intrigued. His most recent update indicates that he's seeing the same equity markets levels being very significant for the short term, as we've indicated around the 884 level in the S&P 500. You can access Armstrong's prior February issue via ContraHour at Martin Armstrong: Is It Time To Turn Out The Lights? It seems that the March issue is available via email. I've included below page 13 of his March report - I want to keep my quotation with reference to Armstrong and his copyright within the bounds of fair use, so this is just the part relating to his views of these major market indices that really ties in closely with what I've been seeing as I've been posting here and at my UBTNB3 blogspot. He states, regarding the Dow Jones Industrials:

"It remains a potential for a Waterfall Effect where we just collapse into the summer reaching the 4000 area. This would be the most positive development we could expect, for this would signal that the end is now here and we may see a bull market at last start to emerge thereafter. The main resistance is standing at 8400, and we need a weekly closing back above this level just to negate an immediate Waterfall Effect for the conclusion of 2009."

Armstrong's comments about the S&P 500 are similar, but also include this fascinating remark: "... This suggests that when the deflation ends, inflation should carry the S&P 500 yet to new long-term highs, but not before making your nose bleed on the way down. ... Our next main support lies at 600, with major support at 460. The ideal target would be in the 460 zone by the summer." I wonder if he's considering Elliott Wave at all with his view? One of the maverick ideas I've kept on the drawing boards is the idea of a final large fifth wave up to new all-time highs, if there remains a possibility that the S&P 500 is only finishing a large 4th wave flat C-wave at levels in that general 460 zone. (Meaning, not that such a level would be part of a large wave (IV) or Circle IV, but would be the completion of a fourth wave (such as wave IV in the standard Elliott Wave counting system). Such a rise could - in my personal, humble opinion - be supported by a similar view of the financial and banking sector completing a similar corrective wave (i.e., assuming that the banks don't just disappear, subsumed into governmental ownership).

Below is the page from the March 23, 2009 Armstrong newsletter. If you're interested in the rest of his comments - which are far-ranging and encompass topics such as target prices and times for gold, the dollar, euro and other currencies, and of course economic cycles - you might check out the email address indicated at ArmstrongEconomics@GMail.COM.*

*PS - (I wrote to that email but no reply yet. So I cannot be too certain just who's on that email.)