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"The best Elliott is always simple. Whenever a wave count becomes complex, it is usually best to stop attempting to count all the wiggles and to answer one basic question: Is the move impulsive (five waves) or corrective (three waves)?"

Tom Denham, editor of our European Financial Forecast Service, is a firm believer in simplicity. He should know: Using his "simple" approach, he turned bullish on European stocks as early as September 2004 and has stayed with the rallies all the way through this spring.

Tom also noticed that after they had topped in April-May, European stock indexes declined in three-wave form – and in Elliott's book, that's a corrective pattern. That meant they would retest their highs. And sure enough they did: In October, the German DAX, Europe's main index, surpassed its May highs. Another victory for "simple Elliott."

Surely you've been wondering how long this advance may last? That's the question Tom Denham answers in the just-published November issue of his European Financial Forecast. In this issue:

Bottom Line: Chances are, European stocks are now in a fifth wave, a final wave of a "simple" Elliott wave sequence. The question is, fifth wave of what degree? A minor-degree fifth wave may only last a couple of weeks, while a larger-degree one can go significantly farther. Just how far – well, each bourse has its own path and wave count. But don’t worry, Tom shows you the likely targets and key support levels for all of them.

Spain's Madrid IBEX 35 Index confidently led Europe's major indexes – the DAX, the FTSE and the CAC – up from the June low. The IBEX poked above its May peak on 22 August; it took other indexes extra two months to accomplish the same feat. The strong rally in Spanish stocks seems unstoppable… Does this mean the rest of Europe will follow again?

Since 1960, 82% of the time, either September or October were down months for the German DAX Index. This year, both September and October were up months – a rare occurrence. What does this unusual strength means for Europe's benchmark index, you ask? Take a look at our charts and extensive analysis to find out.

Britain's FTSE-100 Index began its recovery from the recent June low slowly, bunching up in July, August, and September. However, the FTSE sprang up in October – and now remains within the confines of an important trend channel. Find out what price levels may prove critical for British stocks in the months to come.

The November European Financial Forecast also gives you our latest forecasts for:

France’s CAC40
Amsterdam’s AEX
Zurich’s SMI
Dow Jones Euro Stoxx 50
German Bunds
British Gilts
Plus, don't forget: Every Monday, Wednesday and Friday Tom Denham brings you special global opportunities in his European Short Term Update (ESTU). The latest forecasts include the India Sensex Index. See the Nov. 03 ESTU for details (online now, part of the European Financial Forecast Service).

Click the European Financial Forecast header link above to learn more about trading the waves mannually or automatically with the MTPredictor automated software.

Good day and good trading.

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