We’ve been bullish on emerging markets literally all year long … and it hasn’t been an easy call.

Now that EEM – the iShares Emerging Markets Index – is breaking through to new all-time highs, what’s next?

First, let’s revisit our emerging markets bullish thesis as we’ve published it over the course of this year.

New all-time highs in Emerging Markets are now here – and they’ve been a decade in the making. Take a look at this 15-year chart of EEM.

: EEM 15-year Chart

EEM is breaking through highs not seen since before the 2007 – 2008 market crash.

Earlier in my investing career, I would have looked at the chart above and thought, “Oh well. Missed that one. The party must be over.”

I don’t think that way anymore and neither should you. Let’s take an objective look at where EEM stands today.

EEM triggered a new Stock State Indicator (SSI) Entry signal in August 2016. It entered the SSI Yellow Zone twice in late 2016, but has been moving strongly higher in the SSI Green Zone since the beginning of this year.

EEM Triggered SSI Entry Signal in August 2016

Today, my investment philosophy is that the greenbacks are made in the Green Zone. EEM is solidly in the Green Zone today, and hasn’t even visited the Yellow Zone in nearly a year.

Our time-cycle forecast for EEM has been incredibly accurate. The forecast is telling us that EEM should remain strong for the next couple of months into early 2018.

Highs in EEM Composite Cycle
Stocks that are making all-time highs tend to continue making new all-time highs. And with bullish conditions lined up, EEM could continue to make new all-time highs for quite some time.

Have a good weekend,