The prevailing theme on the international front has been the rotation taking place out of the United States and into a wider set of global markets.
We've seen significantly elevated volatility, and there's now a strong case to be made that the worse is behind us. Many key U.S. indexes have retested their 2021 highs and have firmly held.
Now the question has become - will international still outperform if risk markets recover from here?
A key chart to watch on this front is Europe $VGK versus the United States $VOO.
When this black line is going up, it means that Europe is outperforming the U.S. (as has been the case for a few months).
Right now, the ratio is at a key inflection point. If we see this ratio take out its most recent lows, it would indicate that money is rotating back into the United States.
The ratio will be a key chart to watch when understanding the leadership of the next bullish phase.
