Trading Strategy – iShares Europe ETF

After a strong run of outperformance since early September, the iShares Europe ETF (IEV), which tracks the investment results of the S&P Europe, formed a multi-year high in early October.  Last week’s selloff indicated a bearish turnaround, according to our “U.S. Market Trading Map”. Below is an update look at a trade in the IEV.

The graphic below is from our “U.S. Market Trading Map”, show the near-term technical bias and trading ranges.  As shown, the underlying is in a short-term bullish trend when the price bars are painted in green.  The underlying is in a short-term bearish trend when the price bars are painted in red.  The yellow bars identify period of neutral or sideways trading pattern.  Additionally, the light-blue shading represents the short-term trading range.  A move above or below that range is considered overbought (as represents by the red shading) or oversold (as represents by the dark-green shading).  Readings above or below the red and green shaded areas are considered extremely overbought or extremely oversold.

Chart 1.1 – iShares Europe ETF (weekly)

Our “U.S. Market Trading Map” painted IEV bars in red (sell).  After a steep uptrend, there are some reasons for caution on the move to new highs.  The late September outside reversal bar which is often located at the end of an uptrend.  Adding to concerns is momentum, which has been deteriorated since early summer as prices moved higher.  These elements…Click here to read more.

You see, our trend-following system is very unique as it attempts to pick turns before others see them. Timing is everything and if you’ve applied our system correctly, you should have made a killing in any markets.


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