Commodities and Emerging Markets Update

Some very interesting action in commodities and emerging markets of late.  The growth components of the story continue to look very vulnerable.

The broad emerging markets ETF (EEM) has hit downtrending resistance and appears to be turning lower.

2014-04-15-EEM_CHARTS

Brazil (EWZ) is behaving in-line with that analysis, and appears poised to drop.  It posted a large bearish wick last week and followed up with downside follow-through so far this week.

2014-04-15-EWZ_CHARTS

Last month, copper (JJC) broke support that dates back to 2009.  It rallied back to that trend line and is dropping again today (Tuesday).  A new low would be meaningful.

2014-04-15-JJC_CHARTS

Coffee (JO) made some serious money for those who held it in the first quarter, rallying over 100% from its lows late last year.  It may now be putting a double-top in place.

2014-04-15-JO_CHARTS

One of the more interesting plays to me is gold miners (GDX) and (GDXJ).  I have been long GDXJ for a little while now and am still holding.  What once looked like a possible breakout from a bullish falling wedge has morphed into a possible inverse head-and-shoulders.  Today’s action (4/15) brings GDXJ down to a point of multiple support lines that would seem like a good line in the sand.  If a large gap up (3%) should occur tomorrow, I would take that as a very bullish sign as today’s pricing could be viewed as an isolated doji star.  Even without that development, this appears to be an important inflection point for GDXJ.

2014-04-15-GDXJ_CHARTS

 

 

 

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