There is information everywhere. We analyze both the Indexes and the ETFs. We look at markets all over the world priced in both local currency and in US Dollars. We often use Gold as the denominator as well as the Indexes themselves to analyze relative strength. It’s one big giant web of money flow.
Today I want to call your attention to an interesting divergence that has come at important turning points in the past. Specifically I’m referring to the Wisdom Tree Hedged Exchange Traded Funds for Europe and Japan: $HEDJ and $DXJ respectively. These funds are priced in local currencies as opposed to most other ETFs around the world that are priced in US Dollars.
First, here is the Europe Index Fund priced in Euro breaking out to all-time highs. I’ve been chuckling to myself a lot lately because when was the last time you could say the words “Europe” and “all-time” highs in the same sentence with a straight face? [Read more…]