Daily Form December 16, 2010

Inter-market Technical Analysis using algorithmic pattern detection

THURSDAY DECEMBER 16, 2010       12:10:00 GMT

Yields across the UST spectrum are maintaining their upward momentum and the yield on the 30 year bond closed at 4.6% which has also had the affect of pushing mortgage rates in the US back above 5% which may be just one of the unintended consequences of QE2.

As can be seen on the chart the 4.8% level may act as a target/attractor in the near term.

The Brazilian Bovespa index is sitting rather precariously at a key support level.

The German DAX has been one of the best performing equity indices in Europe and as can be seen on the longer term weekly chart the index has a 78.6% target at 7150. However the ETF which tracks the MSCI Germany Index (see below) does look as though it may be in the early stages of a correction.

Investment grade corporate bonds, as tracked by LQD, have fallen below the 200 day EMA.


The patterns identified below should be considered as indicative of eventual price direction in forthcoming trading sessions.
None of these setups should be seen as specifically opportune for the current trading session.
For a more comprehensive listing of price formations detected by our pattern recognition algorithms please visit TradeWithForm

EWG  iShares MSCI Germany Index  

EWG, an exchange traded fund which tracks the MSCI Germany Index will be worth monitoring for validation that the recent lower top might be the precursor to consolidation/correction.

IDX  Market Vectors Indonesia ETF  

IDX, which tracks Indonesian equities, after registering a series of lower highs may be headed for a test of the base of the cloud formation and even further towards the 200 day EMA which also coincides with a support level on the daily chart.

EWZ  iShares MSCI Brazil Index  

The chart for EWZ, which tracks the MSCI Brazil Index, may also be headed for a testing of the 200 day EMA