There is a lot of analysis being spent on how the US (SPX) has decoupled from the rest of the world’s problems and this deviation is either based on better fundamentals or this is a phenomenon that will eventually give way to buckling developed market equities in Europe, Japan, Nasdaq etc.   

Emerging marketsWhile I'm not here to fight the fight for the SPX I don’t think traders can say that the US cant trade better than the rest of an asset class when in fact for 5.5 years US equities dominated EM equities.  From October 2010 through January 2016 the SPY outperformed the EEM by almost 55%.

We are now focused on the spread between the EEM and the SPY as its clear this trade has changed tone in the last 6 months.  EM bottomed versus the SPX on January 15th and since then has outperformed by 780bps. Through the Brexit announcement EM has been very resilient and has outperformed since the initial mark down of assets by 250bps.  EEM is outperforming $SPY by 200bps alone today.  Additional technical support EEM including a proper head and shoulders bottom formation that has held so far even in the face of the Brexit carnage.



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