The Krakatoa eruption August 27th 1883 may have been the first time that the Emerging Markets had erupted. Back then it was known as the day the world exploded. Everyone knew where Indonesia was after that. If you have not read the book by Simon Winchester it is worth a read as the summer winds down. But Krakatoa was not the only time Emerging Markets erupted.
After a long move lower the Emerging Markets ETF (NYSE:EEM) started to move higher in December 2016. The initial run lasted until May. At that time it turned sideways and consolidated the move for 2 months. In the beginning of July it started back higher with a quick 3 day burst, outside of the Bollinger Bands®. A quick sideways shuffle to get back inside them and a small move higher left it back in consolidation mode. But this time it seems to be shorter.
Wednesday it started to push higher out of consolidation. The Measured Move to the upside would give a target to 46.10. That is significant because the 45 area has been resistance for over 4 years from 2012 to 2015. Momentum supports more upside with the RSI running flat high in the bullish zone and the MACD moving up. The upper Bollinger Bands also leave room to move higher. Seems like Emerging Markets are about to erupt again.
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