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We remain long iShares MSCI Japan ETF ($EWJ) from our pullback entry in early October around $10.70. Although $EWJ has failed to breakout, the price action continues to tighten up in the base, especially over the past few weeks above the 50-day MA. Note the higher swing lows during the base as well. The combination of higher swing lows and tight price action is what we typical look for in basing patterns. We also like the dry up in volume, which is a bullish sign, as traders take $EWJ off their radar because of the choppy action. A breakout above the four week high should quickly lead to new 52-week highs.

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