“Short-term Brazil is sending us some mixed signals. The wedge after support broke in January broke to the downside before quickly reversing this week. As long as prices remain above 41, I think there could be a squeeze towards the mid-40s. Based on this potential and bullish divergence in momentum it is hard to be short right here. I’d prefer to either fade strength into 44-45 or short a break down back below the 50-day moving average,” added Parets.
EWZ Weekly Chart
Chart Courtesy: J.C. Parets, Eagle Bay Capital
Tom Lydon’s clients own shares of EEM.