$EEM vs $SPY Emerging Markets vs SPY ETF is at a critical point now

$EEM vs $SPY Emerging Markets vs SPY ETF is at a critical point now.   A lot of people look at the $EEM Emerging market ETF vs $SPY SP500 ETF in order to gauge the US Stock markets vs Global markets.

In order to do the comparison, we are going to create a customized chart which shows one chart representing the relationship between the two.   On the chart, we will apply the Ichimoku Indicator for analysis.

Below is the customized Ichimoku weekly chart of the $SPY vs $EEM.   If price goes up, the $SPY is stronger than the $EEM and vice versa.

Price has been in the cloud and slowly getting to the yellow support indicating that the $EEM has been stronger than the $SPY since July.  $EEM has moved over 19.39% vs $SPY that has moved 9%. since July.

2016-10-12_121235_eem_spy

We are now at major critical support.    If the support breaks then $EEM will move another estimated 4.13% compared to the $SPY.   If the support holds, then the $SPY could move 7.10% more than the $EEM.

The probabilities are towards the bullish side.    This could be a good possible “pairs” trade for Q4CY2016.

If you would like to learn how to trade like an institutional trader or learn more about our multi-timeframe email alerts, go to www.ichimokutrade.com or email us at info@eiicapital.com

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About the Author Manesh Patel