WEBL ETF Continues Its Climb, Rises Over 20% Past Month

As global economies cope with a surging second wave of coronavirus cases, the need for social distancing measures becomes even more prevalent. In turn, this will help boost internet usage and leveraged funds for traders like the Direxion Daily Dow Jones Internet Bull 3X Shares (WEBL), which is up 20% within the past month.

WEBL seeks daily investment results, before fees and expenses, of 300% of the daily performance of the Dow Jones Internet Composite Index. The fund, under normal circumstances, invests at least 80% of its net assets (plus borrowing for investment purposes) in financial instruments that track the index and other financial instruments that provide daily leveraged exposure to the index or to ETFs that track the index.

Looking at WEBL’s one-month chart below, the fund is above its 50-day and 200-day moving averages with its relative strength index (RSI) within overbought territory. As a global vaccine slowly rolls out, the need for internet use will remain in the forefront as more businesses continue to utilize the web to sell goods and services.

WEBL Chart

WEBL data by YCharts

The 3-month chart below also shows a move above its 50-day moving average during a strong November for equities. An area of value for an entry point will be as close to that 50-day MA as possible.

WEBL Chart

WEBL data by YCharts

Internet Gets Its Own Stimulus

As mentioned, the pandemic has spurred a need for higher internet usage amid social distancing measures. As part of the recently approved stimulus bill, Congress is looking to bolster access to the internet, which should help WEBL’s case even further.

A recent Business Insider article discussing the stimulus package’s role in internet access said the following:

“Congress approved $7 billion in aid on Monday to help lower-income Americans get access to the internet. The spending, which is part of the larger $900 billion COVID-19 stimulus package, would help low-income Americans pay their monthly internet bills and would invest in extending internet access to remote areas of the country, according to the Washington Post.”

“The plan allocates about $3 billion for monthly rebates on internet bills, providing up to $50 per month for low-income families. Households on Indian reservations can qualify for up to $75 a month. The bill will also focus on longer term efforts to support internet access, such as allocating funding to determine which regions lack access to high speed internet and improving infrastructure, the Post reported.

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