Sunday, November 20, 2016

Emerging Markets (EEM, EWZ and FXI) I Think Will Get A Bit Of A Breather Over The Next Ten Days

It's been a while since I've written something as I've been distracted with on-calls at the hospital but a lot has happened since I warned in an article just before the election "Let's Wait For The Dust To Settle." Statistically elections tend to be bullish and we've just had a good second week of the markets rising with, granted, a bit of a pullback on Friday. Additionally, the markets are nervous (or unclear) on the Trump's economic plans. Add into the mix a 90% chance of an interest rate increase in December and things have become quite uncertain. With the dollar's rise emerging markets have taken quite a beating lately but as I should below, for those of you who are interested, long/buy signals have appeared. I think Emerging Markets will get a bit of breather before continuing down again.

RSI is showing a "buy" signal at the moment with things looking quite over-sold. Emerging Markets ETF EEM was just outside the Keltner and Bollinger Bands which reflects the over-sold nature of the market. The same changes are being seen in China and Brazil ETF's, too.