Friday, April 20, 2012

Morning Market Analysis

After breaking support over the last two weeks, the French market is not again at importance technical support levels; the EWQ ETF is trading right above the 20 handle, which has been support for a little more than a week.  Also note the declining status of the shorter EMAs, CMF and MACD.  A move through 20 would make the 19.5 level the next likely target.

The Italian market is also in technically bad shape.  The ETF has fallen nearly 18% (14 to 11.52), has bearish EMAs, A/D and CMF and has prices below the 200 day EMA.

The Italian market is now in bear market territory (it's down over 20%) and shares all of the bearish characteristics of the markets above. 

The above three markets are the weakest of the EU ETFs.  More importantly, they are bearish, and are therefore more likely to continue moving lower, dragging down the other, stronger EU economies.  This will, in turn, have a bearish impact on the US markets.

All three US treasury  ETFS -- the IEIs (5-7 years), the IEFs (7-10 years)  and TLTs (20+ years), have all rebounded and rallied, two to Fib levels (the IEIs and IEFs).  Of particular importance is the fact the TLTs bounced off the 200 day EMA -- the line between bull and bear markets.  What's also important here is the renewed safety bid.