Japan Index Fund (EWJ) Set for For A Big Fall
IShares MSCI Japan Index Fund ETF (EWJ) bottomed out at 6.84 in March and reached the 200-day EMA in May. It hovered at that price level for 3 months and then broke out to a multimonth high. The fund topped out at 10.38 in September and rolled over, testing the 200-day EMA in early October. This level held and gave way to a bounce that failed under the first high.
The fund returned to the low almost two weeks ago and has been moving sideways since that time. A breakdown will trigger a notable sell signal that could precede an extended decline to 8. However, recoveries are often mounted at the 200-day EMA so it’s best to avoid short sales until sell signals are actually triggered. For now, let’s just watch 9.50 for a breakdown.
November 9, 2009
• Posted in: TA
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