Silver is likely to outperform Gold prices in the coming months. Long-term chart of SILVER/GOLD suggests the ratio is at a major turning point. Multi-decade support reversed the ratio three times over the past two decades and this could be the fourth time. Reversal from the strong support in the past resulted in an approximately 1.5x-1.6x outperformance […]
Since the beginning of 2011, developed market equities have been performing better than emerging markets. This trend is still intact. Though there is one emerging European equity market that is showing clear strength against its peers. That is HUNGARY. Budapest SE index is ready for another upward leg, after an initial breakout followed by a pullback. […]
Weak energy prices are putting pressure on oil exporting economies. Kuwait and Nigeria are two of the large weights in the MSCI Frontier Markets index. Both countries indices are testing critical long-term support levels. Already weak stock market performance can continue in the following months if there are further breakdowns. Saudi Arabia, another major oil […]
Following one month of positive price action, weakness resumed in the emerging market equities. Until previously broken support levels are breached on the upside, strength in emerging market equities will be classified as counter-trend move. In other words, MSCI Emerging Markets index should clear 860-900 area on the upside to reverse the larger-scale downtrend. Since the beginning […]
Small caps show relative weakness vs. the large caps when investors move out of riskier/high-beta names and into relatively safe large caps. Opposite can be said during small cap strength vs. large caps. There are two ways to capture this relationship to understand if there is a possibility of small cap outperformance in the following […]
U.S. dollar remains strong against major cross-rates. Several emerging market currencies lost ground against the U.S. dollar during 2014-2015 period. Weak performance was interrupted by a medium-term consolidation over the past few months. U.S. dollar/Hungarian Forint formed one of those identifiable consolidation chart patterns that is usually regarded as a flag or a triangle. These type […]
Central banks across the globe are showing their support for the financial markets by either delaying interest rate hikes or cutting interest rates and showing willingness to increase quantitative easing measures. After the ECB’s dovish comments, Chinese central bank cut interest rates to boost economic growth. Since 2011, markets are positioned for emerging market weakness […]
Saudi Arabia’s Tadawul index breaks down 6 year-long uptrend. 2009-2014 uptrend retraced 38% of the downtrend formed between 2006 and 2009. A fibonacci retracement of 38% and less is considered to be a weak recovery. There is a high probability that the last 6 year’s weak uptrend was not the beginning of a long-term cyclical […]
Emerging market currencies had a relief rally over the past month. U.S. dollar weakened against most of the emerging market currencies with the expectation of a possible delay on FED rate hike. Counter-trend moves in the emerging market currencies might be over and we can see another phase of weakness. An important EM cross-rate is the U.S.Dollar/Indian […]
Global equity markets are showing weakness. A possible change in trend is in progress. Over the past few decades 2 year moving average proved to be a good indicator for following long-term trends. Price is now below the long-term average and as long as it remains below this technical level probability of further correction in equity markets […]
