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Monday, June 17, 2013

The global economy through the markets eyes 6/17

It has been a while since I checked in on what the markets were saying about the global economy.  Lets see what Dr. Copper has to say first.

JJC broke down from a triangle pattern and is just hanging there.  I don't see any indication of a sure bottom much less an actual uptrend.  Not good.

Here is the BRIC ETF.

EEB is slightly breaking key support.  Is it a break down or just another test of support?   I guess this is a little too early to tell for sure.  It could be a false break down.  However, stocks in these countries that are supposed to be the engine of growth for the global economy are not doing well.  If stocks lead the economy it is going to be a while before we start to see better global data.  If this ETF ends up breaking down it could be a sign the global recession is worsening.

Here is a look at the steel ETF.

SLX is also testing key support.  The chart really closely mimics the BRIC ETF.  Will they both break down or is this the bottom?

Here is a look at aluminum.

JJU broke key support.  It then tested that support line from below and appears to be turning back down.

With all these ETFs heading down and breaking or testing key support it is clear the global economy is not picking up steam at the present time.  It certainly does not look like the global bond sell off is being caused by better times just ahead.  If these charts break down it would be a clear sign the global economy is about to get worse.  All these charts are backing up the deflation event scenario that gold might be predicting.  If the global economy gets worse I think it is unlikely we will be unscathed.  If not for hurricane Sandy we might already be in a recession.


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