No Rest For The Bulls

by on March 19, 2012 | ETFs Mentioned:

Equity markets continued their trek higher last week as encouraging economic data is a key driver of price action now that Euro zone woes have finally taken a backseat. In light of the positive fundamental improvements on the home front, this week is looking to be fairly uneventful in terms of major data releases aside from home sales figures. News from international markets also appear to be sparse in the coming days, which makes the trading week all the more unpredictable; will bullish momentum finally cool off or is any pullback a buying opportunity?

Weekly Outlook

Below, we highlight ETFs that may see an increase in trading activity as relevant market data is released and evaluated by investors:

  • CurrencyShares British Pound Sterling Trust (FXB): U.K. inflation data is on tap for Tuesday morning, which could spark volatile trading for the British pound in the currency market. Analysts are expecting for CPI to come in at 3.3%, versus last month’s reading of 3.6%.
  • SPDR Homebuilders ETF (XHB): This ETF may experience an increase in trading volumes as the latest existing home sales figure hits the street. Analysts are expecting for 4.6 million sales versus the previous reading of 4.57 million.
  • MSCI New Zealand Investable Market Index Fund (ENZL): New Zealand equities could see some volatile trading on Thursday as investors digest the latest gross domestic product. Analyst are expecting for Kiwi economic growth to come in at 2.2% versus the previous reading of 1.9%.
  • SPDR Gold Trust (GLD): The precious metal has been facing headwinds lately as better-than-expected economic news have prompted investors to increase their risk appetite. The latest jobless claims report could put additional pressures on gold this Thursday; analysts are expecting for the figure to come in at 353,000 versus last week’s reading of 351,000.
  • IQ Canada Small Cap (CNDA): This ETF could see an increase in trading volumes as investors digest the latest Canadian CPI reading on Friday morning. Analysts are expecting for inflation to come in at around 2.7%, a slight uptick from the previous reading of 2.5%.

The trend is your friend. Fundamental news have been paving the way higher for stocks on Wall Street and price action across markets has been undoubtedly bullish so far this year. Any pullback should be treated as a buying opportunity for those eager to get their feet wet. However, investors should still keep an eye on their positions in case selling pressures accelerate, which could create even more lucrative opportunities for those who are patient. Below, we have highlighted three technical trading ideas for the upcoming week. Note that most of these recommendations require active management as they are only relevant for a very short period of time. As always, investors of all experience levels are advised to use stop-loss orders and practice disciplined profit taking techniques.

Actionable ETF Idea #1: Long FXI

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Disclosure: No positions at time of writing.