With the dollar gaining some strength up above 92 and rates raising to 1.6% in the US 10 yr
emerging markets have started weakening. They are in no position to absorb higher rates
and watch $s investments flea their boarders.
To understand emerging markets you must first understand what the dollar (DXY) is doing. In this chart, I show you the relationship
between the two. You can see several key dates where reversal took place. To get a handle on what drives the dollar (see post below)
You need a good understanding of how the monetary system works, macroeconomics, FOREX, and the Bond...
Thw low may be in for VMO now that it recovered from the 45 multi-year pivot & also from the Anchored VWAP from pandemic low.
If 45 do not hold, VWO may still go down to the 39 to 40 zone for a bottom.
Not trading advice
The macro data from this month's Markit PMI's is sending a bit of mixing signals from the countries that VWO has the most exposure to, but I am still optimistic as to the near-future performance of the emerging markets.
Before going into the macro analysis, whats the market allocation of this ETF.
The 80% market allocation is the following:
- China -> 42.5%
-...
VWO is finishing a leading diagonal first wave out of the the contracting triangle as forecasted in the April 5 post. It should continue its positive trend ahead with minor corrections on the way. The possible end of minute wave v of minor 1 should be at around 39. After this minor 2 wave should retrace to around 35 before the up trend continues. If prices crosses...
VWO just seems to have completed a bullish primary triangle what is the end ov cycle wave IV. In this case, the etf should offer long-term growth ahead. The probable end of cycle wave V up is a growth similar to highest leg of the triangle. This would push the index to around 70, more than double the current value in the long term. FOLLOW SKYLINEPRO TO GET UPDATES.
