After a strong run of outperformance from January 2016 lows to late January 2018 that saw the iShares MSCI Emerging Markets ETF (EEM) nearly doubling, the ETF has been under tremendous selling pressure in recent days, fell 2.6 percent MTD and down 3 percent YTD. Now the question is whether recent selloff is a pause that refreshes or it’s a beginning of something worse? Below is an update look at a trade in EEM.
The graphic below is from our “U.S. Market Trading Map”, show the near-term technical bias and trading ranges. As shown, the underlying is in a short-term bullish trend when the price bars are painted in green. The underlying is in a short-term bearish trend when the price bars are painted in red.
Chart 1.1 – Financial Select Sector SPDR ETF (weekly)
Our “U.S. Market Trading Map” painted EEM bars in red (sell) – see area ‘A’ in the chart. Over the past few weeks, EEM has been basing sideways using the 50-week moving average as support. That level roughly corresponds with the 23.6% Fibonacci retracement. It offered strong support since the ETF broke out in mid-2016. Last week’s massive selloff pushed EEM below…Click here to read more.
You see, our trend-following system is very unique as it attempts to pick turns before others see them. Timing is everything and if you’ve applied our system correctly, you should have made a killing in any markets.
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