While most of our focus will be directed to markets in North America, much of the conditions that are conducive to market strength (or weakness) will have effects on the markets of other nations as well, especially since the complex grid of taxes, interest rates, trade restrictions, demographics and political variables are all interconnected like a big tinker-toy structure. Sometimes, strength in one market will result in weakness in another, but generally markets will move in similar fashion because of the international nature of money flows.
Having said that, there are some conspicuous beneficiaries of the benign investment climate that we are now in. The charts below illustrate, via nation oriented ETF’s, the positions of select world markets.
The first chart is Emerging Markets. This is probably the best way to monitor all the various and sundry markets world wide without the risk of illiquidity. As the chart shows, the trend looks quite favorable for a continued advance. From top to bottom, we note that RSI readings show continued positive movement, SCTR rankings are only so, so but acceptable; force of money flow is trending positively; prices are rising against turning moving averages; volumes are a bit non supportive recently; the DMI indicators are showing a turn to a positive trend and finally Cumulative money flow, while yet to show positive, appears to be doing so.
We apply these same technical observations to other country ETF’s.
Australia, looks quite positive.
Canada, pictured above also quite positive.
China, shown above looks very dynamic since an area of resistance is being tested again. With other statistics supportive, this looks very interesting.
Brazil and Russia respectively shown above, look particularly interesting. We can see that SCTR readings (refer to Stockcharts.com for a description of this measure) remain consistently high indicating persistent buying interest.
The market showing conspicuous weakness is…Mexico. Some may blame the recent Whitehouse posturing for this, but as we can see, the downtrend has been underway for years. Something significant will need to occur to change this picture.