MIKE PAULENOFF'S ETF TRADING DIARY
Since its July 15 low, the iShares Brazil ETF (AMEX: EWZ) was up 2.5% through yesterday's close whereas the SPY was up 6.7%. In addition, the pattern carved out by the EWZ has taken the shape of a bearish coil, which warns me to expect another bout of weakness. The fact that the coil has developed under both the 200 DMA and below the one-year support line is an ominous sign indeed, and suggests that the EWZ is heading for 75.00-74.00 next -- likely on the way to 71.00-70.00. Why? Brazil is heavily associated with the global commodity complex. Easy come, easy go, right?
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