Looking across the various regions tracked in our Trend Analyzer tool, broadly speaking equities are lower over the past week, but some of the worst performance comes from across the pond in Europe. As shown, the ETFs tracking European equities are all down the most over the past five days through yesterday’s close. That leaves each one over 2 standard deviations below their 50-DMAs. On a year to date basis, these have similarly been serial underperformers along with the Latin America 40 ETF (ILF).
Taking a more granular look at specific European countries, in the charts below we show the ETFs tracking the equity markets of each of the European countries in our Global Macro Dashboard as well as an ETF tracking European equities more broadly: the iShares Europe ETF (IEV). As shown, whereas the region was already weak headed into today’s session, the pain has only gotten worse this morning. So far today, these 10 ETFs are down an average of around 4% as the region experiences an upswing in COVID cases and reinstating of lockdowns in places like Germany and France.
From a technical perspective, today’s big drops are not doing these country ETFs any favors. Most of these ETFs have been trading sideways over the past few months, and today’s sharp turn lower is marking breaks of various support levels. For some like Sweden (EWD), it is a break below the 50-DMA while others like Germany (EWG) are falling below their longer term 200-DMAs. Other country ETFs such as Spain (EWP) and Russia (ERUS) have been trading under their moving averages for some time now, but today’s decline has broken additional support that was formed from prior lows. Click here to view Bespoke’s premium membership options for our best research available.