Most Requested Symbols
There are no changes to any of the iShares models this week. Since peaking in March the US dollar index DX/Y has fallen approximately 10%; as a result, in yesterday’s Daily Equity Report, we updated our US dollar study which shows how various assets perform in rising and falling US dollar environments. As the table below shows, international equities, represent by the iShares EAFE ETF EFA and iShares Emerging Markets ETF EEM, tend to be strong performers in a falling dollar environment.
Those who are interested in adding exposure to international equities in light of the dollar’s recent trend may wish to consider the iShares MSCI All Country Asia ex-Japan ETF AAXJ, which recently reached a new multi-year high when it broke a spread triple top at $77. AAXJ currently has a near-perfect 5.66 fund score, 2.21 points better than the average for all non-US equity funds, and a positive 3.80 fund score direction. Year-to date (through 9/3) the fund has gained 7.58% on a price return basis and comes with a 1.54% yield. A weekly overbought/oversold reading of 71% puts AAXJ slightly above the ideal action range, so those adding exposure may be best served to look for a slight pullback or wait until prices normalize at current levels. AAXJ has most recently found support at $73, with further support afforded at $67.
The distribution curve places each ETF on a bell curve according to their respective degrees of overbought or oversold status using a 10-week distribution. ETFs that are statistically oversold will appear on the left-hand side of the bell curve, while those that have become statistically overbought will appear on the right-hand side of the bell curve. Perhaps the most useful attribute of this feature is that it displays the entire universe on the curve at one time with an "average level" to give us a general picture of whether the iShare ETF universe is generally overbought on a near-term basis, or generally oversold. Our best opportunities are to buy strong market ETFs that have regressed back toward mean conditions based on market weakness, or have become oversold based upon extreme market weakness.
Weekly Distribution is a short-term gauge that is most helpful in timing entry and exit points, while the longer-term information of trend and relative strength is a more controlling factor in the decision of whether to buy or sell. The Distribution Curve below displays those ETFs with positive RS in uppercase letters and those ETFs with poor RS versus the market in lowercase letters. As well, those ETFs that are on a Point & Figure Buy signal appear in Green letters, while those on Sell signals can appear in Red letters. Box Color indicates the Sector Status Rating. Green = Favored, Yellow = Average, and Red = Unfavored.
Average Level
52.42
| <--100 | -100--80 | -80--60 | -60--40 | -40--20 | -20-0 | 0-20 | 20-40 | 40-60 | 60-80 | 80-100 | 100-> | |||
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