$EPP, $EWA, $TUR - rolling over like many other indices

Tracking risk appetite across bipolar asset markets

SATURDAY JUNE 1, 2013       13:30:00 GMT

The close of trading on the last day of May brought a sell off in US equities, a stronger US dollar and underlined the erosion in the prices of emerging markets - particularly the debt market ETF's such as ELD and PCY - as well as several other key geographical indices.

The weekly chart below for EPP, an MSCI tracker for Asian markets excluding Japan, reveals the sharp negative divergences on the MACD chart which preceded the recent topping out pattern. As the dotted lines indicate there are plausible near term targets at both the $44 level and at $41.70 which coincides with the Ichimoku cloud top as well as potential support from the upward sloping trend line through the weekly lows

The MSCI Australia index as captured by the exchange traded fund, EWA, illustrates the same divergence as noted above and the indications suggest that in the medium term a short position would still be quite profitable.

I have previously been bullish on Turkish equities but the weekly chart below for the exchange traded TUR suggests that this index may have registered an intermediate term peak and could head towards the $60 level in the coming weeks.