Throughout October, the iShares Core S&P 500 (N:IVV) rebounded remarkably from the lows made in late August, breaking above both moving averages and getting close to new all-time highs. After a volatile but stagnant final two months of the year, in which the market straddled the moving averages with no clear direction, the index once again broke down in the last week, and in the same violent manner as in August. 1900 is the next level down. If we can’t hold that, look for us to test the 1867 level, the previous low. The S&P 500 is already down 5.88% year-to-date after posting a gain of just over 1% in 2015.
The EU (iShares MSCI Eurozone (N:EZU), or the European Economic and Monetary Union, fell more gradually over a longer period of time when compared with its US counterpart. And it never recovered with the same verocity. Europe has been consistently underperforming the US for some time now, after outperforming for half of last year. The index is down 6.28% for all of 2016.
After a huge “irrationally exuberant” run into April, the Chinese markets (iShares China Large-Cap (N:FXI) plunged over 35%, breaking both long-term MAs. It had been trading within a range since but once again broke down after the wedge pattern it developed over the last few months settled out. Look out below. The China Large Cap index is now down 10.40% in 2016.
A stronger US dollar, ISIS, and crashing crude oil prices are just a few of the things the WisdomTree Middle East Dividend (O:GULF) has to contend with. The supply of crude oil is probably the biggest driving factor of this market, and that is still a net negative for the index, especially with Iran coming to the market soon. The index is down 3.60% since the beginning of the year.
Another region hit hard by the commodity bust. The iShares Latin America 40 (N:ILF) broke down in May and August of last year, and again in the last few weeks after trading in a range for a few months. It now finds itself below strong support at the 21 level. It has moved concurrently with the crashing commodities market and is still struggling to hold any support. The index has recorded a loss of 8.73% this year.
Africa’s market (Market Vectors Africa (N:AFK)) has been hurt by continued upheaval in Northern Africa and Nigeria, coupled with a weak global economy and a worsening political climate in South Africa. It is down 5.85% for 2016 after a tough summer and a horrendous 4th Quarter.
Japan ((iShares MSCI Japan (N:EWJ))) is no longer holding onto gains that were made after the BOJ unexpectedly eased monetary policy in the beginning of last year. Japan is down 5.61% YTD, after being the best performing market in 2015.
