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3 Market Tops in Asia: See Wave Analysis Work in Real Time
The Wave Principle gives you the how and the why behind Asian markets

By Nathaniel Williams
Thu, 15 Mar 2012 17:45:00 ET
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Identifying trend reversals is a critical part of investing. And it's especially critical at market tops. If you miss one, you could lose your investment in the ensuing downturn.

So how, then, do you pinpoint a market top? If you rely on fundamental analysis, you may be out of luck. Oftentimes, fundamentals are strongest at market tops, since the economy lags the markets.

Yet it is possible to identify market tops. Case in point: In early 2011, EWI's monthly Asian-Pacific Financial Forecast accurately alerted readers -- in real time -- to three market tops in Asia, as you can see in the chart below. Here's how editor Mark Galasiewski (pronounced 'gala-shev-ski') describes it in the new March issue:

  
Fifteen months ago, Bangladesh's Dhaka General Index completed a five-wave impulsive advance from its 2009 low and then plunged below the uptrend line that had supported its advance from its 2009 low. We hypothesized that the event marked the start of another topping process in the region. "Like high-beta sector indexes, peripheral markets sometimes turn down ahead of core markets," we explained.
 
Four months later in early 2011, we said that Sri Lanka and Mongolia had probably also topped out. Since then the price action in Asia's peripheral markets has continued to support our hypothesis (see chart). Other global peripheral markets, such as Nigeria and Bulgaria, have also continued falling in recent months. Bloomberg reports that "all nine of the world's worst-performing equity indexes this year are in frontier countries."
 
Galasiewski didn't need fundamental analysis or the mainstream financial media to nail these tops. He simply used the Elliott Wave Principle. Its objective rules and guidelines help you understand how and why markets go up and down -- and they give you an objective method to understand and anticipate market action.
 
You see, the Wave Principle takes advantage of the fact that markets don't move in only one direction. So when Galasiewski's wave analysis suggested that a typical five-wave impulsive move was complete, he knew to expect a correction, per the Wave Principle's guidelines. Wave analysis isn't a crystal ball to see exactly what will happen in the future, but this recent analysis shows how valuable and spot-on it can be.


 
In the new March Asian-Pacific Financial Forecast, the same wave analysis that pinpointed tops in these peripheral markets tells you what might be next for core Asian-Pacific markets -- including how much rally the core Asian-Pacific markets might have left.
 
You also discover which pivotal characteristics of a market top to look for, along with specific forecasts and detailed charts for all major Asian-Pacific markets.
 
It's a critical perspective for any forward-thinking Asian-Pacific investor. Get ahead of the trend -- and put our Asian-Pacific analyst to work for you -- in minutes, completely risk-free for 30 days.

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FFSThe Asian-Pacific Financial Forecast is the world's most forward-thinking investment letter for Asian-Pacific markets.

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