Emerging Market Currency ETF Failed Breakout

Emerging Market Currencies Topped in January

This should resolve by June and possibly as soon as this month. Either new highs in EM currencies (weaker USD) or EM equities run into a wall of resistance.

Emerging Market Currency Fund Testing Breakout Support

WisdomTree Emerging Currency (CEW) is back at the long-term trend support (former resistance).

EM Bonds, Currencies, Stocks Breakdown

ETF bonds (EMB), currencies (CEW) and stocks (EEM) breakdown on Monday. China ETF on the brink.

Emerging Market Currency Troubles

ZH: Argentine Peso Plunges To Record Low - Breaks Central Bank Line In The Sand

USDHKD is also headed for another hit at the upper limit of 7.85

Offshore Yuan Follows Onshore Yuan at New Multi-Year Low

Chinese yuan versus emerging market basket (which includes yuan) and commodity currency basket ETF.

Gold Bottoming In Most Currencies

Here is a chart of GLD versus PowerShares DB U.S. Dollar Index Bearish Fund (UDN). This shows the price of gold relative to the foreign currency basket that is the U.S. Dollar Index (Euro 57.6%; Japanese Yen 13.6%; British Pound 11.9%; Canadian$ 9.1%; Swedish Krona 4.2%; Swiss Franc 3.6%). Notice that the 50-day moving average is still above the 150-day.

Here is GLD alone. The 50-day moving average has cross the 150-day moving average, but the bounce is more pronounced due to recent USD weakness relative to the euro and yen.

Here is GLD against CEW, an emerging market currency basket.

Finally, GLD versus the Australian dollar (FXA), which has been very weak since May. Notice that gold has actually flat-lined since May in the Australian dollar. Good news for Aussie miners?

Gold also appears to be topping versus the miners. Here is GDXJ, which formed a head-and-shoulders pattern in the 14-day RSI. This isn't necessarily bullish for miners, only that they will outperform the next move in gold, up or down.

Since I expect a U.S. dollar rally, the gold price may be under pressure moving forward, but I expect it will not breakdown again in currencies such as the Australian dollar.

Revaluing the Chinese yuan

Another call for RMB appreciation, this time in April: Yuan Appreciation Is Necessary, and Best in April

Chinese yuan has not been moving much against the U.S. dollar, obviously, but the U.S. dollar has been moving against the euro.
China's export growth is coming from emerging economies though, according to government data, and more than half of exports now go to developing economies. The WisdomTree Dreyfus Emerging Currency (CEW) is down as well, however, in 2010.
I do not see the Chinese appreciating their currency on the back of U.S. dollar appreciation because this would be a bold, rather than cautious move. The gradual approach is to counteract the prevailing trend, not exacerbate it. Unless they truly fear inflation, which at this point seems in check, it doesn't make sense. Also, something tells me the Chinese know that revaluation will shake the currency markets and with the euro situation, they probably don't want to be blamed for causing excess volatility.

Another view of the rally

Here's the SPDR S&P 500 Index (SPY) divided by PowerShares DB U.S. Dollar Bearish (UDN)

Here's the SPY divided by CurrencyShares Australian Dollar (FXA)

Here's the SPY divided WisdomTree Emerging Market Currency (CEW). Much shorter time-frame because CEW issued in the spring.

Here's the SPY divided by SPDR Gold Shares (GLD). Notice the weak trendline.