Brazil ETF Could Be Breaking Out
The iShares MSCI Brazil ETF has squeezed into a tight range since the coronavirus pandemic, but now it could be nearing a breakout.
Today’s chart uses two-week candles to display the price action since 2016.
First consider the falling trendline since December 2019, along the highs of 2021, 2022 and earlier this year. EWZ jumped above the line last week after cooler-than-expected inflation sank the U.S. dollar. Traders may watch to see whether EWZ can hold these levels or add to the gains.
Second is the gradually rising trendline since 2016. Notice how the ETF made a higher low at the end of September above the support. That may reflect an accelerating uptrend.
Third, prices bounced around $25 in July 2022 and March 2023. That double bottom may confirm the presence of lurking buyers.
Fourth, the recent price compression (highlighted by Bollinger Bandwidth) may give way to price expansion.
Finally, investors could focus on valuations and the macro environment as the New Year approaches. EWZ trades for less than half the P/E ratio of the S&P 500. Investors may also see opportunities in global assets if the Federal Reserve is done hiking rates and the U.S. dollar continues to weaken.
Standardized Performances for ETF mentioned above:
iShares MSCI Brazil ETF (EWZ):
1-year: -8.88%
5-years: -25.85%
10-years: -40.65%
(As of Oct. 31, 2023)
Performance data shown reflects past performance and is no guarantee of future performance. The information provided is not meant to predict or project the performance of a specific investment or investment strategy and current performance may be lower or higher than the performance data shown. Accordingly, this information should not be relied upon when making an investment decision.
Exchange Traded Funds (“ETFs”) are subject to management fees and other expenses. Before making investment decisions, investors should carefully read information found in the prospectus or summary prospectus, if available, including investment objectives, risks, charges, and expenses. Click here to find the prospectus.
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TradeStation Securities, Inc., TradeStation Crypto, Inc., and TradeStation Technologies, Inc. are each wholly owned subsidiaries of TradeStation Group, Inc., all operating, and providing products and services, under the TradeStation brand and trademark. TradeStation Crypto, Inc. offers to self-directed investors and traders cryptocurrency brokerage services. It is neither licensed with the SEC or the CFTC nor is it a Member of NFA. When applying for, or purchasing, accounts, subscriptions, products, and services, it is important that you know which company you will be dealing with. Please click here for further important information explaining what this means.
This content is for informational and educational purposes only. This is not a recommendation regarding any investment or investment strategy. Any opinions expressed herein are those of the author and do not represent the views or opinions of TradeStation or any of its affiliates.
Investing involves risks. Past performance, whether actual or indicated by historical tests of strategies, is no guarantee of future performance or success. There is a possibility that you may sustain a loss equal to or greater than your entire investment regardless of which asset class you trade (equities, options, futures, or digital assets); therefore, you should not invest or risk money that you cannot afford to lose. Before trading any asset class, first read the relevant risk disclosure statements on the Important Documents page, found here: https://www.tradestation.com/important-information.
Today’s chart uses two-week candles to display the price action since 2016.
First consider the falling trendline since December 2019, along the highs of 2021, 2022 and earlier this year. EWZ jumped above the line last week after cooler-than-expected inflation sank the U.S. dollar. Traders may watch to see whether EWZ can hold these levels or add to the gains.
Second is the gradually rising trendline since 2016. Notice how the ETF made a higher low at the end of September above the support. That may reflect an accelerating uptrend.
Third, prices bounced around $25 in July 2022 and March 2023. That double bottom may confirm the presence of lurking buyers.
Fourth, the recent price compression (highlighted by Bollinger Bandwidth) may give way to price expansion.
Finally, investors could focus on valuations and the macro environment as the New Year approaches. EWZ trades for less than half the P/E ratio of the S&P 500. Investors may also see opportunities in global assets if the Federal Reserve is done hiking rates and the U.S. dollar continues to weaken.
Standardized Performances for ETF mentioned above:
iShares MSCI Brazil ETF (EWZ):
1-year: -8.88%
5-years: -25.85%
10-years: -40.65%
(As of Oct. 31, 2023)
Performance data shown reflects past performance and is no guarantee of future performance. The information provided is not meant to predict or project the performance of a specific investment or investment strategy and current performance may be lower or higher than the performance data shown. Accordingly, this information should not be relied upon when making an investment decision.
Exchange Traded Funds (“ETFs”) are subject to management fees and other expenses. Before making investment decisions, investors should carefully read information found in the prospectus or summary prospectus, if available, including investment objectives, risks, charges, and expenses. Click here to find the prospectus.
TradeStation has, for decades, advanced the trading industry, providing access to stocks, options, futures and cryptocurrencies. See our Overview for more.
Important Information
TradeStation Securities, Inc., TradeStation Crypto, Inc., and TradeStation Technologies, Inc. are each wholly owned subsidiaries of TradeStation Group, Inc., all operating, and providing products and services, under the TradeStation brand and trademark. TradeStation Crypto, Inc. offers to self-directed investors and traders cryptocurrency brokerage services. It is neither licensed with the SEC or the CFTC nor is it a Member of NFA. When applying for, or purchasing, accounts, subscriptions, products, and services, it is important that you know which company you will be dealing with. Please click here for further important information explaining what this means.
This content is for informational and educational purposes only. This is not a recommendation regarding any investment or investment strategy. Any opinions expressed herein are those of the author and do not represent the views or opinions of TradeStation or any of its affiliates.
Investing involves risks. Past performance, whether actual or indicated by historical tests of strategies, is no guarantee of future performance or success. There is a possibility that you may sustain a loss equal to or greater than your entire investment regardless of which asset class you trade (equities, options, futures, or digital assets); therefore, you should not invest or risk money that you cannot afford to lose. Before trading any asset class, first read the relevant risk disclosure statements on the Important Documents page, found here: https://www.tradestation.com/important-information.
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