iSHARES MSCI SOUTH KOREA ETF (EWY)

Technical analysis

Price

$ 78.23

52 weeks range

$ 74.88 - $ 96.30

Beta

1.20

Volume/ average

5.6m / 4m

Sector

ETF (Mixed fund)

Dividend

0.71%

The iShares MSCI South Korea ETF aims to track the investment results of an index composed of South Korean equities.


After a very positive performance in 2020, the MSCI South Korea ETF is ending the current year with a YTD of -7.85%.

In the last period, we have noticed some divergences that could suggest a bullish recovery as we enter the new year.


Price

Analyzing the current price of EWY we note that the bearish descent stopped at $ 76 - $ 80.00. Price range that played the role of strong resistance from October 2017 to May 2018 and in the most recent December 2020 instead played as support before a bullish upside.

In addition, we can see the formation of a bearish channel with slight lateralization in the last two months which could eventually lead to the upward break of the channel.

Indicators

Looking at the MACD and RSI indicators, we notice a marked positive divergence between the price action and the indicators' trend.

MACD, from the lows recorded in October 2021 has gradually reached the threshold just below 0: in divergence with the price that is having lower lows and highs.

RSI, since August 2021, is having higher lows despite a continuously falling price.


Moving averages

The 50MA remains a strong point of reference for a possible change in trend: its breach could in fact coincide with the upward break of the bearish channel at $ 80-82.


Conclusions

A quotazione corrente, l’ETF di riferimento per la Korea del Sud incomincia a essere di nuovo interessante. La forte divergenza tra prezzo e indicatori MACD - RSI sembra voler anticipare un cambio di trend (approfondimento sulle top holdings a pagina 2)


Crediamo che, una volta rotto il canale ribassista e assestatosi al di sopra della media a 50 giorni, sia opportuno cominciare a costruire una posizione su questo ETF con un target conservativo a $94.00


Fascia di entrata $ 80.00 - $81.00

Target 1 $ 85.00

Target 2 $ 94.00

Stop loss $ 72.50.00


Top 10 holdings


Ticker

Nome

Peso

005930

Samsung Electronics LTD

23.99%

000660

SK Hynix Inc.

5.86%

035420

Naver Corp.

4.33%

006400

Samsung SDI LTD

3.40%

035720

Kakao Corp.

3.06%

051910

LG Chem LTD

2.96%

KRW

KRW Cash

2.79%

005380

Hyundai Motor

2.76%

000270

Kia Motor Corp.

2.18%

105560

KB Financial Group Inc.

2.17%

Analizzando le prime 10 holdings di EWY, con peso complessivo del 53.5%, possiamo notare una situazione diversa rispetto all’ETF: se da una parte EWY ha avuto, e sta avendo, una anno nettamente ribassista. Dall’altra le 10 maggiori holdings presentano scenario e formazioni più incoraggianti: trend consolidati al rialzo e formazioni di inversione rialziste.


OTB Global Investments

17 December 2021

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