The MSCI AC World Index has been struggling for direction for most of this year after registering a false break to new highs in April. On balance, it seems that the pressure to break below the 40-week moving average is building up, although momentum indicators remain neutral for the time being. The main source of downward pressure on the index is the declining 10-week moving average, but the 40-week measure is still advancing, albeit slowly. It may be that any excursion below the 40-week moving average is short-lived. In general, the opposing forces of mostly bearish emerging markets and flat, or improving, developed markets remain finely balanced. Much will depend on a move to new highs by the S&P 500 Index at the end of the summer. John Schofield is the founder of Tempus Investment Research
