Will 'oversold' EWU get more oversold? Now hearing headlines of potential move of British Pound to parity. High energy costs hurting consumers and business may hurt profits for companies. WIll EWU hold or continue down trend?
Neutral for now, but long-term looks like UK is set to outperform Eurozone
Better to wait for confirmation!
Either way, UK (EWU) is looking somewhat promising as well.
Conviction: 3/5
Main risk is that we will retest previous support at a lower level
Evidence
breaking out of LT support (2007)
RSI-D recently turned down from overbought levels
Risk
Could retest previous resistance at lower levels in the coming weeks/months
RSI-M and RSI-W are not showing particular signs of overbought or oversold
Introducing the Buffett Indicator
One aspect of the recent rotation from growth stocks to value stocks is that investors have been rotating into undervalued markets that have suffered ten-year downtrends. The "Buffett Indicator" provides a way of comparing country-wise stock market valuations. The indicator divides total market cap (TMC) by GDP plus Total Assets...
AMEX:EWU is in an established uptrend and, though it has broke below a trendline, shows plenty of strength to the upside. With this key bullish reversal bar, it looks that this drop is probably a very normal pullback before it continues to move upward...at least to the previous trendline.
Equities out of the United Kingdom have led the European regional indices higher on the back of strong performance from companies like BP plc., which has a TACVOL score of 3.25 suggesting that a near-term reversal is imminent.
Cyclicals, such as miners, and dollar earners led the falls while consumer staples such as Unilever, TACVOL score of 3.09, are in favor....
I-Shares United Kingdom ETF EWU
has built a Bullish Cup Pattern, as seen on the included chart.
The next decline could form the "handle" on the pattern,
which would then form a completed "Cup and Handle" Pattern.
Daily Volume in this ETF is over a million shares, so plenty of liquidity for traders.
A near term bullish breakout in EWU would project this ETF up...
On a fairly regular basis, I look for things to add to my covered call portfolio. While on occasion I'll dabble in individual underlyings, my preference is to look to exchange traded funds that represent an asset class (e.g., XRT (retail), XLF (financials)) or market (e.g., EWZ (Brazil), EEM (emerging markets)) so that my hat's not always hanging on a single...
Long Spain , Short U.K. This pair trade has been successful 77.82 % of the time during the past three years. Trade should last about 15 days .
Long EWP @ 33.17
Short EWU @ 18.52
Cheers
Algo
NYSE Arca
