Prudential Equity Group, LLC Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Market Technician’s Association Education Seminar 2005 All important disclosures can be found at the end of this document in the section entitled “Additional Information” beginning on page 44. May 2005 Advanced CMT Topics Equities: Practical Applications/Presentation Peter J. Martin, CMT V.P., Senior Technical Analyst Prudential Equity Group, LLC.

Equity Research Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Martin Market Averages: Near-Term Trends (Daily Bar Charts) Source: Reuters.; Prudential Equity Group, LLC. 200-Day Moving Average The Nasdaq Composite failed to make a new high in early March creating a negative divergence.

Equity Research Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Martin Market Averages: Near-Term Trends (Daily Bar Charts) Source: Reuters.; Prudential Equity Group, LLC. 200-Day Moving Average Holding just above long- term moving averages. Broke below its long- term moving average and is staying there.

Equity Research Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Martin Market Averages: Intermediate-Term Trends (Weekly Bar Charts) Source: Bloomberg L.P.; Prudential Equity Group, LLC. Broke its 2-year upward bias. DJIA Breach of its cyclical bull trend with negative divergence. MACD Indicator NASDAQ Composite Penetration of major uptrend MACD Indicator S&P 500 MACD shows negative divergence.

Equity Research Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Martin Market Averages: Intermediate-Term Trends (Weekly Bar Charts) Source: Bloomberg L.P..; Prudential Equity Group, LLC. S&P 400 S&P 600 Russell 2000

Equity Research Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Martin Market Averages: Intermediate-Term Trends (Monthly Bar Charts) Source: Bloomberg L.P..; Prudential Equity Group, LLC. DJIA S&P 500 NASDAQ Composite

Equity Research Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Martin Market Averages: Intermediate-Term Trends (Monthly Bar Charts) S&P 400 S&P 600 Russell 2000 Source: Bloomberg L.P..; Prudential Equity Group, LLC. Outside month

Equity Research Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Martin Dow Theory (Line Charts-Closing Prices) Source: Reuters.; Prudential Equity Group, LLC. Positive Divergence sets up eventual buy signal.

Equity Research Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Martin A/D Line Comparisons Source: Lowry’s Reports.; Prudential Equity Group, LLC. Primary A/D Line Still Below MA 1-Year Low Intermediate- Term Low

Equity Research Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Martin Confirmed March price high Source: Lowry’s Reports.; Prudential Equity Group, LLC. Barely confirmed

Equity Research Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Martin Source: Dorsey, Wright & Associates; Prudential Equity Group, LLC.

Equity Research Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Martin Source: Dorsey, Wright & Associates; Prudential Equity Group, LLC.

Equity Research Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Martin Source: Lowry’s Reports.; Prudential Equity Group, LLC. (Cycle timing)

Equity Research Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Martin Source: Reuters.; Prudential Equity Group, LLC. Intermarket Analysis: Fixed Income: Yield On The Ten-Year Treasuries Potential major bottom in rates. Near-term softness in rates.

Equity Research Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Martin Source: Reuters.; Prudential Equity Group, LLC. Intermarket Analysis: Commodities CRB Index 50-Day Moving Average Normal correction off top end of channel Short-term correction underway

Equity Research Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Martin Source: Reuters.; Prudential Equity Group, LLC. Intermarket Analysis: Commodities Crude Oil Intermediate-term trend is still up… Correction underway! Higher prices still appears attainable to us. Upside objectives $61 and $67

Equity Research Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Martin Source: Reuters.; Prudential Equity Group, LLC. Intermarket Analysis: Commodities Gold Secular Bull Move Major trend is up! Minor support at $423. Major Base

Equity Research Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Martin Source: Reuters. ; Prudential Equity Group, LLC. Intermarket Analysis: Currencies US Dollar Trend violation; More base building needed! Three Important Lows It will likely take much more time to reverse this three downward bias… Short-term action is rangebound $80- $85

Equity Research Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Martin Source: Reuters. ; Prudential Equity Group, LLC. Style Strategy Large Cap Value Vs. Growth Russell 1000 Value Relative To Russell 1000 Growth Value outperforming over all time periods.

Equity Research Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Martin Style Strategy Mid Cap Value Vs. Mid Cap Growth Russell Mid Cap Value Relative To Russell Mid Cap Growth Source: Reuters. ; Prudential Equity Group, LLC. New intermediate- term trend high. Uptrend of mid 2003 low continues. Its value over growth across all time periods.

Equity Research Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Martin Style Strategy Small Cap Value Vs. Small Cap Growth Russell 2000 Value Relative to Russell 2000 Growth Source: Reuters.; Prudential Equity Group, LLC. Short-term trend is positive. Intermediate- term trend is neutral Long-term still shows an upward bias.

Equity Research Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Martin Source: Reuters.; Prudential Equity Group, LLC. Style Strategy By Capitalization (Large Cap Vs. Small Cap) Russell 1000 Relative to Russell 2000 Short-term uptrend now in place. Potential bias shift towards large-caps. More time required to see if trend violation is legitimate.

Equity Research Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Martin Style Strategy By Capitalization (Large Cap Vs. Mid Cap) Russell 1000 Relative to Russell Mid Cap Source: Reuters.; Prudential Equity Group, LLC. Short-term transition towards large caps. Downtrends still in force. Mid outperforming large- caps on both an intermediate and long-term basis.

Equity Research Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Martin Style Strategy By Capitalization (Mid Cap Vs. Small Cap) Russell Mid Cap Relative to Russell 2000 Source: Reuters. ; Prudential Equity Group, LLC. Slight breach of short-term. Trend now neutral. Intermediate- term trend still favors mid-caps. Back and forth action leads to neutral condition on a long- term basis.

Equity Research Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Martin Comparative Relative Strength: A Different Look Source: Bloomberg L.P.

Equity Research Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Martin S&P Sector Analysis Consumer Discretionary (Relative Vs. S&P 500) Weighting: S&P Actual 4/8/05—11.3% Technical Opinion: Market Weight Source: Reuters.; Prudential Equity Group, LLC. Relative falling sharply. Intermediate-Term trend is now neutral. Absolute trend is also neutral. Long-term trend is now neutral.

Equity Research Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Martin S&P Sector Analysis Consumer Staples (Relative Vs. S&P 500) Weighting: S&P Actual 4/8/05—10.4% Technical Opinion: Market Weight Source: Reuters.; Prudential Equity Group, LLC. Uptrend, while erratic, is in place. Intermediate-term & long-term trends maintaining their neutral stance.

Equity Research Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Martin S&P Sector Analysis Energy (Relative Vs. S&P 500) Weighting: S&P Actual 4/8/05—8.8% Technical Opinion: Overweight Source: Reuters.; Prudential Equity Group, LLC. Both absolute & relative trends are consolidating recent sharp upside. Intermediate and long-term trends remain positive.

Equity Research Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Martin S&P Sector Analysis Financials (Relative Vs. S&P 500) Weighting: S&P Actual 4/8/05—19.7% Technical Opinion: Underweight Source: Reuters.; Prudential Equity Group, LLC. Relative strength in a short-term downtrend Intermediate downtrend now in force. Major shift in trend.

Equity Research Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Martin S&P Sector Analysis Health Care (Relative Vs. S&P 500) Weighting: S&P Actual 4/8/05—13.2% Technical Opinion: Market Weight Source: Reuters.; Prudential Equity Group, LLC. Short-term uptrend now in place. Long-term trend is now neutral. Breach of intermediate-term downtrend.

Equity Research Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Martin S&P Sector Analysis Industrials (Relative Vs. S&P 500) Weighting: S&P Actual 4/8/05—11.9% Technical Opinion: Overweight Source: Reuters.; Prudential Equity Group, LLC. Intermediate-term relative strength trend is neutral. Absolute trend is also neutral. Short-term trend is neutral. Longer-Term trend does still have an upward bias.

Equity Research Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Martin S&P Sector Analysis Information Technology (Relative Vs. S&P 500) Weighting: S&P Actual 4/8/05—15.0% Technical Opinion: Underweight Source: Reuters.; Prudential Equity Group, LLC. Short-term downtrend in place. Intermediate-term downtrend has been extended. Downtrend in place.

Equity Research Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Martin S&P Sector Analysis Materials (Relative Vs. S&P 500) Weighting: S&P Actual 4/8/05—3.2% Technical Opinion: Overweight Source: Reuters.; Prudential Equity Group, LLC. Intermediate and Long-term uptrends remain intact. Short-term trend has transitioned to neutral.

Equity Research Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Martin S&P Sector Analysis Telecomm Services (Relative Vs. S&P 500) Weighting: S&P Actual 4/8/05—3.1% Technical Opinion: Market Weight Source: Reuters.; Prudential Equity Group, LLC. Accelerated downtrend has been breached. Intermediate and long-term trends remain neutral.

Equity Research Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Martin S&P Sector Analysis Utilities (Relative Vs. S&P 500) Weighting: S&P Actual 4/8/05—3.3% Technical Opinion: Overweight Source: Reuters.; Prudential Equity Group, LLC. All absolute & relative price trends remain positive.

Equity Research Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Martin Prudential Equity Group’s Proprietary Technical Rankings Source: Prudential Equity Group, LLC.

Equity Research Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Martin Source: Bloomberg L.P.

Equity Research Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Martin S&P 500 Aerospace/Defense Group & Boeing Co. (BA) Source: Bloomberg L.P.

Equity Research Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Martin S&P 500 Air Freight & Logistics Group & FedEx Corp. (FDX) Source: Bloomberg L.P.

Equity Research Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Martin S&P 500 Property & Casualty Group & MBIA Inc. (MBI) Source: Bloomberg L.P.

Equity Research Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Martin S&P Groups That We Believe Are Investable Source: Prudential Equity Group, LLC.

Equity Research Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Martin S&P Groups That We Believe Are Avoidable Source: Prudential Equity Group, LLC.

Equity Research Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Martin Breaks Of Major Uptrends/Tops Source: Prudential Equity Group, LLC.

Equity Research Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Martin

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Equity Research Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Martin

Equity Research Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Martin

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Equity Research Prudential Equity Group, LLC One New York Plaza 15 th Floor New York, NY Martin