With Internet stocks, both the U.S. and global varieties remaining hot, it is not surprising that the KraneShares CSI China Internet ETF (NasdaqGM: KWEB) has been one of the most talked ETFs in recent weeks.
KWEB deserves the acclaim because the ETF has gained nearly 47% since its Aug. 1, 2013 debut. Under most circumstances, a 47% run in that amount of time is impressive, but KWEB’s success is even more so when considering Chinese stocks have been laggards for over a year. [Inside One of the Best China ETFs]
KWEB is up about 14% year-to-date and 21% over the past 90 days, leaving some investors to wonder if the ETF still has some upside left. It looks like the answer is “yes,” but entry points will prove critical.
KWEB’s “daily chart shows the recent pullback off the highs, finding support at the 20-day MA. Since there was a sharp pullback to the 20-day exponential moving average, the price action may stall out and trend sideways for a while before the uptrend resumes. If so, then we will look for a low risk entry point to emerge early next week,” writes Deron Wagner of Morpheus Trading Group.
Being an ETF focused exclusively on Internet stocks means KWEB is not bereft of built-in momentum, but there are lingering catalysts that could propel the fund higher as 2014 moves along. For example, the next wave of Chinese Internet initial public offerings.