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Global Market Collapses Finally Get Some Attention!

  • Written by Syndicated Publisher No Comments Comments
    June 14, 2013

    Global markets outside of the U.S. have been in significant negative divergences with the U.S. market for most of the year, with their downturns accelerating even as the U.S. market climbed to successive new highs.

    Even since topping out mid-May the U.S. market has remained resilient, only reluctantly pulling back 3 or 4%.

    But finally, this week analysts are all over the global collapses as being something potentially important, as in can the U.S. stand up alone if global economies and markets are tanking seriously.

    It seems to have taken the bursting of the bubble in the Japanese market to finally get the U.S. market to look beyond our borders.

    And it shouldn’t be liking what it sees.

    It’s not just the breaking of short-term support levels like 50-day moving averages that should be getting attention. 

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    But the potential damage to the intermediate-term outlook, with sell signals triggered on intermediate-term indicators some months ago, and important markets having broken beneath not only short-term 50-day moving averages, but also intermediate-term 20-week m.a.’s.

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    The collapses in the markets of the large economies like China, Japan, the eurozone, Brazil, Hong Kong, India, etc., are of enough concern.

    But in the last two weeks the spread of the collapses to the emerging market countries (that were supposed to remain strong no matter what happened in developed countries) has become more obvious. 

    As we have been pointing out since the beginning of the year, although widely touted by Wall Street as the place to be this year, the emerging markets were looking quite sick.

    And in the last couple of weeks the head and shoulders top that was potentially forming has completed, with emerging markets plunging below the ‘neckline’ (the blue line), signaling more decline is likely.

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    It is a very important question for the U.S. market whether it can be expected to continue its resilience as more and more global markets collapse further, into bear markets.

    This might be a good time to have another look at the studies of how global markets tend to move in tandem seasonally: Market’s Seasonal Patterns in Global Markets!

    To read my weekend newspaper column click here:  Which Way For Gold From Here-

    Subscribers to Street Smart Report: There is an important hotline from last evening and an in-depth ‘U.S. Market Signals and Recommendations Update’ in your secure area of theStreet Smart Report website.

    Images: Flickr (licence attribution)

    About The Author

     

    Sy Harding publishes the financial website Street Smart Report Online and a free daily Internet blog at Sy’s Free Blog. In 1999 he authored Riding The Bear – How To Prosper In the Coming Bear Market. His latest book is Beat the Market the Easy Way! – Proven Seasonal Strategies Double Market’s Performance!

    It includes our research and analysis on the economy and markets, and provides charts and buy and sell signals on the major market indexes, sectors, bonds, gold, individual stocks and etf’s, including short-sales and ‘inverse’ etf’s.

    It provides two model portfolios as guides. One is based on ourSeasonal Timing Strategy, one on our Market-Timing Strategy.

    In depth updates are provided every Wednesday, with interim ‘hotline’ updates every time we make a trade. An 8-page traditional newsletter Street Smart Report is provided on the website every 3 weeks, in pdf format for viewing or printing out.

    There is the Street Smart School of online technical analysis ‘seminars’,commentaries to keep you ‘street smart’ about Wall Street, and much more. 

     

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