The China 25 and Emerging Markets. The trades I prefer as both of these look bad, at least for broad coverage (individual names are preferable , but both ETFs could offer some decent coverage, especially if you need it in a pinch) are FXP for China and EDZ for Emerging Markets. As always, be careful when using leveraged ETFs (these are both inverse so they are a short play on China and EM by buying them).
Here's the China 25 FXI and Emerging Markets EEM charts.
The daily EEM chart shows a decent size top that's showing some volatility around support as it has broken through it recently. The gain today is not in line with the broader markets so there is relative weakness there as well. Note today's gap up volume is quite shy.
EEM on a 5 min chart shows a tiny bit of accumulation late yesterday, around the same time as the market, so this is not a move based on anything other then correlation with the market. Currently there's strong confirmation here -at least on the 5 min.
The 1 min is showing the start of some weakness, we'll see if it continues, we may be heading toward the gap.
FXI-China 25 Index ETF
Again, another large top that broke major support recently, it caught some support yesterday from the hammer in February. Note the volume. The bigger picture here is not pretty, unless you are a short.
The 5 min chart is in exact confirmation, it to is headed down as of the capture.
The 1 min chart shows no such confirmation.
These are both looking weak, as the market is (see the previous post), this is a good time to add incrementally or to establish positions in FXP/EDZ if you like the trades. I personally do, but do not want to have too much exposure to any ETF until they begin to trend. ETFs are dangerous in sideways chop, even more so for leveraged ETFs like EDZ/FXP
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