Notes:

1. 1. adjusted using the methodology popularized by Robert Shiller (Yale; Irrational Exuberance), as modified for quarterly data
   2. based upon historical relationship of EPS and GDP as described in chapter 7 of Unexpected Returns: Understanding Secular Stock Market Cycles; useful for predicting future business cycleadjusted EPS
   3. S&P 500 Index is the value at the end of the quarter
   4. ‘Reported’ is based upon actual net income for the past year (trailing four quarters); ‘Adjusted’ is an inflation-adjusted multi-year average; ‘Crestmont’ see note 2
   5. P divided by E
      Copyright 2008-2009, Crestmont Research (www.CrestmontResearch.com)

CURRENT STATUS (Mid First Quarter 2009)

The 18.6% year-to-date decline has returned P/E to fairly undervalued (from ‘somewhat undervalued’) and has positioned the market for nearer-term above-average returns (assuming that the economy is not expected to enter a multi-year period of significant deflation or relatively high inflation).

Foreign exchange trading is largely driven by technical analysis, and in this short book Chen offers insights into the markets, trading strategies, and details on the mechanics of forex trading.

The book is very well suited to the novice trader. The primer on technical analysis offers a great review for CMT candidates. It also highlights the importance of Elliott Wave and Fibonacci numbers in forex trading.

More experienced traders in stocks, bonds, or commodities will benefit from the book’s comprehensive explanation of the mechanics of the market. As traders know, each market has its unique personality and forex is no exception. It is very important to understand the subtleties and drivers of the markets. This is especially true in highly leveraged markets where losses can mount quickly.

In explaining the markets, Chen offers valuable insights into the fundamental factors that lead to moves in a currency. While technicians often ignore fundamental data in

Economic Indicators are valuable and reliable reports that are assembled by the Government, Universities and the private sectors of business. They measure the economic health of our overall economy. Most are monthly reports and some are weekly. Generally, the Market, as a whole, listens very carefully to the results to determine whether they are “net buyers” or “net sellers” for the day.

Whenever a report is released, you need to be aware of the time and information given. It can dramatically change the price direction, depending on how the Market interprets it. There are many different indicators. Below we have given you a sampling. You must understand that not all indicators are important all of the time, so you must learn them, observe the reactions to them and, then, form an opinion on which ones help you in your specific style of trading. And to make it all more fun, their

Technical analysis works in any freely traded market. Legend has it that technical analysis has been employed for centuries in the commodities markets for hundreds of years, since the days when Japanese rice traders relying on candlestick charts. In the first half of the twentieth century, great technicians such as Shabacker and Edwards and Magee, applied the principles of the field to the stock market.

In Technical Analysis of the Financial Markets: A Comprehensive Guide to Trading Methods and Applications, John Murphy wrote that technical analysis is well suited to futures markets. The diversity of these markets makes it difficult to master fundamental analysis in any one market.

Foreign exchange is the latest market where technical analysis is an invaluable tool to analyzing the markets. Forex is a deep market where traders employ a great deal of leverage to profit from small moves.

Recently, some brokers have been offering leverage greater than 100

CMT Level 3 Exam – REGISTRATION CLOSES FRIDAY!

Registration for the CMT Level 3 Exam closes this Friday, April 3rd. Sign up today! For detailed instructions on how you can register online, please click here. Contact Marie Penza, 646-652-3300, for information on the CMT Level 3 Exam and/or to schedule your exam.

A Letter from the Symposium Committee Chair, Jeff Lay, CMT

Dear MTA Members, Affiliates, and Financial Professionals,

On behalf of the MTA Board of Directors, I want to extend a personal invitation to our association’s premier annual event – the Market Technicians Association Annual Symposium. The theme for 2009 is Secular Markets, Cyclical Risk: The Gilded Age of Technical Analysis.

This year’s list of marquee speakers is world class professionals and experts in the field of technical analysis. The range of topics at this year’s symposium represents an incredible opportunity to hear from