timwest

Brazilian Real Fund ready to follow XLE higher

Long
BATS:BZF   None
354 views
This is quite an overlay of the Brazilian Real Fund (BZF) versus XLE (energy etf ). Since most of the Brazilian market is PBR and VALE or plainly oil stocks, it appears that the currency is similar too.

It looks like there is relatively easy-money buying the BZF and selling short the XLE , $ for $ for a 1-2 month 10% profit.
BZF $18.99 last (for $10,000 trade, buy 526 shares)
XLE $77.28 last (for -$10,000 trade, sell short 129 shares)

Risk, 5% initially, then reduce it to 3% within a week.

Cheers.

Technical Tim, Friday 10:25AM EST , Sep 14, 2012
Subscribe to my indicator package KEY HIDDEN LEVELS $10/mo or $100/year and join me in the trading room KEY HIDDEN LEVELS here at TradingView.com

Comments

I think XLE is oversold enough to warrant taking this trade off. Cover XLE short. Exit BZF long. XLE was at 77.28 to start and is now down at 72.33 for a nearly 5% gain. BZF is down to 18.73 from 18.99, which is down 1.5%, so the overall trade is up only 3.5%, excluding any commissions costs.
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http://stockcharts.com/h-sc/ui?s=BZF%3AXLE&%3Bp=D&%3Bb=5&%3Bg=0&%3Bid=p01189878306
XLE has been doing all the work on this pair ---- so far, so good.
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timwest timwest
NOTE: I had to delete the previous link because it didn't work properly. It said basically the same thing as this, except it said the pair is up 4% at best. There was almost no loss prior to experiencing profits as XLE turned and has been in a steady downtrend since posting the original idea.
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Followed.
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Followed.
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Followed.
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Agreed.
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Followed.
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Nice find Tim !
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timwest Algokid
Thanks. Stumbled into it after I was looking at PBR and thought about other ways to trade Brazil and energy in general.
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