Emerging stock markets are the number 1 beneficiary in this new dominant trend in global markets. As per our 15 leading indicators page with conclusion highlighted in the dominant trend favors stock markets it is the emerging markets setup that stands out. We see the confirmation of a new secular bull market in emerging stock markets, and it starts in April 2019. With this our BULLISH emerging markets forecast for 2019 (EEM) is about to materialize with a very high degree of confidence. Similarly, our India stock market outlook 2019 (NIFTY) and bullish China stock market outlook (SSEC) are all being confirmed now.
The chart below is by far the most juicy one in terms of long term outlook.
As a reminder we identified in our emerging markets outlook the Euro being a leading indicator. This is what we wrote:
- The Euro is leading as major turning points on the emerging markets chart coincide with major turning points on Euro’s chart (not necessarily the other way around).
- Every of these turning points coincide with major support or resistance on the Euro’s long term pattern: a breakdown from an in-pattern structure or breakout.
So major turning points in emerging markets coincide with major ‘events’ on the Euro chart specifically on Euro’s chart pattern(s).
As seen on the most recent Euro chart (click to the 15 leading indicators page with a hyperlink in the intro) there is nowhere near any sign of bearishness. Consequently, with a great emerging markets chart setup, we read it as follows: green light for emerging markets to move much higher.
Our emerging markets price target is now confirmed. This is what we wrote 6 months ago, and we now see a confirmation of our price target:
We believe that emerging markets will consolidate before moving higher in 2019. If this happens as expected our price target for 2019 will be 52 and, ultimately, 60 in 2020 for EEM ETF.
That’s an upside potential of 36 % in 2019 on the index. Some select countries and sectors will do much, much better!