Welcome and thank you for visiting!

The charts, graphs and comments in my Trading Blog represent my technical analysis and observations of a variety of world markets...
* Major World Market Indices * Futures Markets * U.S. Sectors and ETFs * Commodities * U.S. Bonds * Forex

DISCLAIMER: All the information contained within my posts are my opinions only and none of it may be construed as financial or trading advice...
please read my full Disclaimer at this link.


...If the dots don't connect, gather more dots until they do...




* Wed. March 21 @ 2:00 pm ET ~ FOMC Announcement + FOMC Forecasts + @ 2:30 pm ET ~ Fed Chair Press Conference
* Fri. March 30 ~ U.S. markets closed for Good Friday Holiday
* Fri. April 6 @ 8:30 am ET ~ Employment Data
* Wed. April 11 @ 8:30 am ET ~ MoM & YoY CPI & Core CPI Data
* Wed. April 11 @ 2:00 pm ET ~ FOMC Meeting Minutes
* Wed. April 18 @ 2:00 pm ET ~ Beige Book Report
* Wed. May 2 @ 2:00 pm ET ~ FOMC Announcement
*** Click here for link to Economic Calendars for all upcoming events

Wednesday, October 17, 2012

EEM ~ Weekly H&S and Daily H&S Patterns

Below are a Weekly chart and Daily chart of the Emerging Markets ETF (EEM).

A very large Head and Shoulders pattern has been building on the Weekly timeframe since September 2009. Price is retesting a zone in the vicinity of the right shoulder and appears poised for another attempt at a break above.

Within the right shoulder is another smaller Head and Shoulders pattern, which has been building since August 2011 on the Daily timeframe. Price is retesting the September 14th "shooting star," the high of which represents the top of the right shoulder (which is still forming) on this timeframe. Furthermore, a bullish moving average "Golden Cross" formed two days ago, and, once again, price closed just above the 50% Fibonacci retracement level today. Volumes have picked up a bit over the past couple of days.

If price breaks and holds above 43.00, the next level of resistance is the top of the Daily "head" and Weekly "right shoulder" at 44.91 (if it can make it above the 60% Fib level at 43.93).

You can see how EEM is performing compared to the BRIC countries, as shown on the 6-Month Daily charts below. If we see India and China weaken, we may see the others, including EEM, follow suit. All five bear a close watch over the next few days, as any weakening, in the near-term, may negatively affect U.S. equities.