There aren’t a ton of global stock markets trading well technically, but Brazil (NYSEARCA: EWZ) has a chance to be a leader.
I’ve had my eye on this one for a while. Let’s take a closer look at this BRIC emerging market ETF.
Charting the Brazil Stock Market ETF (EWZ)
September and October saw an incredible rally off the low. Since then, the gains have held as well as you could expect given the steep stock market correction / bear market across the global markets.
In the chart below we see that 37-35.50 area has been a pivot zone for over a year, acting as support, resistance and now support again.
This area makes for a great reference point for any short to intermediate term exposure.
With potential upside to the 2018 highs area, the risk reward has skewed nicely in favor of the bulls while price held above this area.
Given today’s breakout and 6% rally, the risk-reward is just not as great as it was. That said, the nature of price action suggests the upside is still there and we just need to carefully consider position sizing because the downside reference point is further away now..
Trade ‘em well!
Twitter: @ATMcharts
Any opinions expressed herein are solely those of the author and do not in any way represent the views or opinions of any other person or entity.
