FXStreet (Guatemala) - Analysts at Brown Brothers Harriman explained that EM is enjoying a nice bounce to end the week. Key Quotes: "Surging oil is one factor, while further ECB (and potentially BOJ) stimulus is another. The Fed tightening, while still alive, has likely been pushed out a bit by the markets in terms of timing. The global liquidity outlook has clearly moved in favor of EM, at least for now. Indeed, the million dollar question is: Has EM bottomed? Longer-term, the commodity situation remains murky as the supply-demand imbalance remains in place. We have always felt that a halt to the commodity plunge was a necessary but not sufficient condition for overall EM sentiment to improve. Fed tightening will eventually happen, and this will should put the broad-based dollar rally back on track. Lastly, the global growth picture does not seem to favor EM just yet. The IMF provided a reminder this week with its forecast revisions. Bottom line: enjoy this EM rally with a short-term timeframe in mind, with the idea that EM turbulence will likely return later this year. With that in mind, we identify some possible retracement objectives from the most recent EM sell-off. Many EM assets traded sideways for most of Q4 before coming under renewed pressure in late December. MSCI EM fell 15% from December 24 until January 21. Retracement objectives from this move come in near 732.50 (38%), 746.65 (50%), and 760.75 (62%). It has not yet retraced 25% of this move. China: USD/CNY has retraced less than 25% of the December-January rise. Retracement objectives from that move come in near 6.5475 (38%), 6.5325 (50%), and 6.5175 (62%). Break of 6.5175 is needed to set up a test of the December 25 low nears 6.47." For more information, read our latest forex news.