Over the past decade, emerging markets such as the IBovespa (IBOV) have underperformed the U.S. considerably. Recently however economic surprises in emerging economies have begun to show signs of recovery, which historically led to better than expected gains, in accordance with analysts forecasts. During times such as these, compared to the U.S. when Emerging markets begin to show healthy economic data, the Emerging Markets / S&P 500 ratio fared quite well.
For the midterm, providing IBOV can convincingly break, hold and close above the reliable 200 period daily moving average, at (1) we should expect to see a steady price increase with a first target in mind at 99940s followed by 102205.0 in extension. Alternatively, any weakness around these current levels (1) will most likely lead to an increase in selling pressure, where 93360s will be the first stop to the downside followed by 92280s. Below that, good support comes in at 90021.20.
For the midterm, providing IBOV can convincingly break, hold and close above the reliable 200 period daily moving average, at (1) we should expect to see a steady price increase with a first target in mind at 99940s followed by 102205.0 in extension. Alternatively, any weakness around these current levels (1) will most likely lead to an increase in selling pressure, where 93360s will be the first stop to the downside followed by 92280s. Below that, good support comes in at 90021.20.