I'd like to make a few more comments on the weekly chart of the Nasdaq Composite index you see below.
In April 2005 the index made a low at the 1890 level and in my view another bull market upswing has begun from 1890. How far might it carry? 'There are three previous upswings in the current bull market that can be used as precedents for the current move up. The first carried the index up 37.3% from the bear market low of 1108 in October 2002 to the 1521 level two months later. The biggest of the three upswings carried the index up 71.8% from the March 2003 low of 1253 to the January 2004 high of 2153. The last upswing carried the market up 25.2% from the 1750 low in August 2004 to the 2191 high in January 2005.
If we add these percentage gains to the 1890 low of April 2005 we get upside targets of 2593, 3245 and 2365 respectively. The third target based on the percentage gain of 25.2% I think can be disregarded because the corresponding upswing was actually part of a trading range and I think the market has begun a breakout move. The first two targets correspond nicely to the targets of 2567 (50% of the 2000 high) and 3120 (1/2 point of the 1108 - 5133 range) that I cited in my last post. So I conclude that the upswing which began from the April 2005 low will in all likelihood end the bull market and terminate very near one of these two targets (probably the higher one).