EM Currencies May Be Setting Up For Next Leg Down

The left chart shows the daily chart of FXCM's EMBASKET, which is an equally weighted index of the CNH, MXN, ZAR and TRY. The index is below its black 20-day SMA and the SMA is pointing down. Moreover, the daily RSI is below 50 (blue rectangle), which is indicative of a bearish momentum. The hourly EMAs have crossed bearishly and the hourly RSI has pushed below 50 (green ellipses). These are bearish developments, at a time when the daily chart is reacting off of SMA resistance.