SAUDI ARABIA TADAWUL INDEX

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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 bull market. With the latest breakdown Saudi Arabia’s index could enter into a larger scale multi-year correction targeting 2009 low levels.

Strong resistance area will remain between 8,000 and 9,000 levels.

SAUDI ARABIA TADAWUL INDEX * Weekly scale price chart of Saudi Arabia Tadawul Index                   Data: Thomson Reuters

VIETNAM VN INDEX

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Vietnam equities are showing strength. Massive multi-year base formation may be close to completion. Vietnam’s VN Index is testing 640 levels for the third time since 2009. Breakout above 640 will be very positive and can push the index towards 1,000-1,100 area.

VIETNAM VN INDEX

Another form of base formation can be seen on the VIETNAM Market Vector ETF that trades in NYSE (VNM). The ETF is forming a possible complex head and shoulder bottom with the strong resistance at 19.7 levels. Breakout above 19.70 will confirm the H&S bottom on VNM.

Both charts suggest following months and year can be positive for Vietnam equities. 

MKT VECTOR VIETNAM

ROMANIA BUCHAREST BETI

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ROMANIA BUCHAREST SE INDEX

Strength in European equities is helping the frontier equity markets in Eastern Europe. Relatively smaller markets such as Romania’s BETI index had strong performance over the past few years and the uptrend is likely to resume. In the beginning of 2014, BETI cleared 6,150 levels. Now the index is trying to breakout from a medium-term consolidation range by pushing above 7,340 levels.

BRD GROUPE SOCIETE GENERALE

BRD GROUPE SOCIETE GENERALE (ROBRD.BX) ( is a financial sector company that trades on the Bucharest Stock Exchange. According to Reuters the company is the 4th largest in the BETI index with $1.66 billion market cap. Stock is now breaking out of a 2 year-long base formation with a strong weekly price bar. Chart pattern price target is around 12.5 levels. Flat-range breakouts are usually powerful and are followed by strong trend periods.

For those who has direct access to Eastern Europe, Tech Charts community will be happy to hear your recommendations regarding efficient ways to access these markets.

 

VIETNAM VN INDEX and QATAR DSM 20 INDEX

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In 2014, Qatar has been upgraded to emerging market status with the United Arab Emirates. Vietnam is still in the frontier market universe. Over the past year both indices formed head and shoulder top chart patterns. Head and shoulder is a common reversal chart pattern, that usually forms after a long up/down-trend. Since the beginning of 2009, global equity markets had  strong uptrends. Some of the equity markets are now showing signs of weakness.

Qatar DSM 20 index formed a head and shoulder top with a downward sloping neckline. Downward sloping neckline is usually more negative than a horizontal neckline. Vietnam VN index has a horizontal neckline at 510 levels. Breakdown below the neckline is a confirmation of larger scale correction. For Qatar DSM 20 index breakdown below 10,700-10,920 area will signal further weakness and for Vietnam VN index, a decisive break below 510 levels will confirm the year-long head and shoulder chart pattern.

QATAR DSM 20 INDEX

VIETNAM VN INDEX

SERBIA AND SLOVENIA

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Frontier markets performed well over the past year. More and more frontier equity markets are gaining strength. Both Serbia and Slovenia equity indices are completing 2 year-long base formations. Slovenia SBITOP Index cleared 700 levels; a horizontal resistance for the cup & handle formation. Index should target 970 levels in the medium-term. Serbia SRX USD index is one step behind from Slovenia. Serbia is still preparing for a strong breakout above 187 levels that will also complete the bullish chart pattern. Both indices are gaining strength and technical outlook is turning positive. More information on cup with handle formation (here).

SLOVENIA SBI TOP INDEX

SERBIA SRX USD INDEX