Market Time Out?
With the domestic US markets sneezing yesterday, will the international ones catch a cold? The S&P 500 recorded a bearish engulfing candle Thursday although the benchmark has for the most part shrugged off these examples in 2024 in rapid fashion. Will that continue? An interesting development however was the strength of the small caps as the Russell 2000 (IWM broke above a 207.37 double bottom pivot but will the fourth time be the charm breaking above the resistant 210 level) surged nearly 4% as portfolios that were very overweight the mega caps and short the smaller names may be beginning to unwind. Will this potential outflow from the huge domestic names also reveal a rotation into some other international areas? One area of interest is the chart below of the EEM which is acting well and the longer-term WEEKLY has some appeal too. Notice the break above a bullish ascending triangle pivot of 41 in a base more than 2 years long and then the successful retest confirming its legitimacy 2 months ago. The breakout carries a measured move to the very round 50 number.