U.S. Stocks Trying To Catch Up To Global Recovery

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October 31, 2018 7:11am NYSE:EFA

From Chris Kimble: Numerous global stocks indices peaked in January as they started creating a series of lower highs and lower lows. While a good deal of global stocks were heading south, major indices in the states continued higher.


This divergence created this question; Will US stocks pull weak global markets up, or will US stocks be pulled lower by global weakness?

This month it appears that US Stocks are playing a game of “downside catchup with weak global markets!”

Below looks at the S&P 500 over the past 50-Years on a monthly basis-

The S&P is testing the top of its 30-year rising channel with momentum at levels last seen in 1987, 2000 & 2007 at each (3).

The long-term bullish trend in the S&P would be damaged if the “S&P plays downside catchup with global markets and breaks support at (4)!


The iShares MSCI EAFE Index Fund ETF (EFA) rose $0.42 (+0.68%) in premarket trading Wednesday. Year-to-date, EFA has declined -11.82%, versus a 0.74% rise in the benchmark S&P 500 index during the same period.

EFA currently has an ETF Daily News SMART Grade of A (Strong Buy), and is ranked #1 of 61 ETFs in the Foreign Large Cap Blend ETFs category.


This article is brought to you courtesy of Kimble Charting Solutions.


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