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Asian Markets Collapse More Worrisome Than US Decline

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    August 21, 2013

    The US market topped out in May when concerns about the Fed beginning to taper back on QE-type stimulus first surfaced. It was rescued when Fed Chairman Bernanke rushed in with calming words and promises in June.

    I said at the time that he was probably more panicked by the double-digit plunges in global markets than the 6% decline in the U.S. market.

    The relief rally was short-lived.

    The U.S. market has rolled over again, and again on concern about government stimulus being dialed back. The S&P 500 is already back below its May peak.


    But once again it’s Asian markets that are the bigger worry.

    Asian markets, and global emerging markets had already failed to get back to their May peaks, have been much more concerned than the U.S. market about what central banks dialing back stimulus will do to their already struggling economies.




    It even has markets in Europe more concerned about the bad news on Asian economies than the good news recently on the euro-zone economies.


    And the Japanese Topix Index is in one of those rare symmetrical triangle formations we sometimes get to show you. The direction of the breakout usually determines the next direction of a market.


    Put it all together and it has that potential head and shoulders top on the FT World Index EX-USA looking even more ominous.




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    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!

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