With as many momentum divergences as had developed by late last week, it was interesting to me just how badly conditions in the Middle East had to deteriorate before Western markets finally took notice. While the S&P 500 only finished down -0.5% on the week, the Emerging markets ETF, EEM, finished down a full -2.5%, now down over four percent on the month.
As of early Sunday evening, U.S. and international futures continue to point lower on lack of resolution and momentum follow-through. Consumer Staples (XLP), Health Care (XLV) and Large-Cap Growth (PWB) also finished the week in early oversold states — there may be some interesting, long-awaited reentry points for cautious bulls ahead.
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