A Divergence With the Rest of the World

The S&P 500 is in divergence with the rest of the world. Even as the index is making new all-time highs Thursday, weakness in many of the emerging and international markets could prove to be too much of a drag on this overbought rally, and a catalyst for a May decline.

Copper -- Weekly Source: StockCharts.com View Chart » View in New Window »

The above chart shows the copper index breaking below the support line of a large wedge formation, and the iShares Emerging Markets Index (EEM) breaking a yearlong uptrend line. These former levels will likely be retested, but it's a bearish indication when long-term areas of support or resistance are penetrated. These two charts set the backdrop for an analysis of several of the international iShare ETFs relative to the S&P 500....273 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

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