The bloodbath for emerging-market currencies that erupted Friday may just be getting started, according to the Ichimoku cloud strategy that correctly forecast last year’s five-month slide. The technical analysis shows that MSCI’s currency gauge has once again broken downward through its forward-looking cloud, or the space between two moving averages. Once it pierces the cloud multiple times, it’s likely to gain momentum in that direction.
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The S&P 500 also remains above the Ichimoku cloud. Also a sign of rocky times ahead.
This scary chart supports the Ichimoku cloud expectation of a rocky road ahead for the S&P 500 index.
The gold spot could also experience turbulence, but less so. Gold is near the top of the Ichimoku cloud.
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