Global Equity Indices Breadth Update 22-05-2011

Developed Markets

S&P 500 (United States) has been moving sideways since the 18th of February of this year. The rally that started at 1040 after the Jacksons Hole speech by The Bernank at the end of August, is currently looking tired and over-stretched. May's price action has been quite average, but the index still holds both the 50 day as well as the 200 day moving average, and has yet to make any lower lows, which tend to signal a downtrend. The index currently trades more than 6% above its 200 day moving average.

DAX 30 (Germany) has also been moving sideways since the 18th of February of this year. May's price action has been quite average, but just like the S&P 500, the index still holds both the 50 day as well as the 200 day moving average, and has yet to make any lower lows, which tend to signal a downtrend. The index currently trades about 5.5% above its 200 day moving average. Friday's reversal candle is quite worrying, from the short term perspective. German equities have been under-performing United States equities since early December of 2010.

Nikkei 225 (Japan) topped on 18th of February of this year and than entered a full crash mode during the earthquake crisis in March of 2011. May's price action has been a continuation of a sideways move since middle of March. The index is yet to break above any of the moving averages. The index currently trades more than 3% below its 200 day moving average. Japanese equities have been under-performing United States equities since early December of 2010.

FTSE 100 (England) has also been moving sideways since the 18th of February of this year. May's price action has been very average, as the index barley holds its 50 day moving average. Unlike the S&P 500 as well as the DAX 30, the FTSE has failed to make a new high during the April rally. The index currently trades about 2.5% above its 200 day moving average. Friday's grave stone candle is quite worrying, from the short term perspective. English equities have been under-performing United States equities for over 8 months (this chart).

CAC 40 (France) has also been moving sideways since the 18th of February of this year. May's price action has been very average, just like the FTSE 100, as the index barley holds its 50 day moving average. Another similarity to the FTSE, is that the CAC 40 also failed to make a new high during the April rally. The index currently trades about 2% above its 200 day moving average. Friday's outside day reversal candle is quite worrying, from the short term perspective. French equities have been under-performing United States equities for over 8 months (this chart).

Emerging Markets (BRIC)

Bovespa (Brazil) has also been moving in a downtrend since the 05th of November of last year (Feds QE II meeting). May's price action has been a disaster, as the index continues to make lower lows, also known as a downtrend. The index currently trade below all of its main moving averages and currently is below its 200 day moving average by over 6%. Brazilian equities have been under-performing United States equities since October 2010.

Russian Exchange (Russian) has also been in a strong correction mode since early April 2011. May's price action has been a continued selling pressure that we saw in April, as the index continues to move towards its 200 day moving average. The index currently trades more than 2.5% above its 200 day moving average. Russian equities have been out-performing United States equities until April, when the story switched.

Bombay 30 (India) has also been moving in a downtrend since the 05th of November of last year (Feds QE II meeting). May's price action has been continuous selling pressure. Unlike the Bovespa however, Bombay 30 has yet to make a new lower low. The index currently trade below all of its main moving averages and currently is below its 200 day moving average by over 2%. Indian equities have been under-performing United States equities since October 2010.

Shanghai Composite (China) has also been moving in a triangular pattern of lower highs and higher lows since 05th of November of last year (Feds QE II meeting). May's price action has been quite average, as the index still holds the 200 day moving average, and has yet to make any lower lows, which tend to signal a downtrend. However, the index is still below the 50 day moving average. Chinese equities have been under-performing United States equities since November 2010.