Timing's Right for Five Country-Based ETFs

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iShares MSCI Spain Index (EWP)

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Source: eSignal

The iShares MSCI Spain Index (EWP) ETF posted a notable high in the fourth quarter, just like other instruments reviewed in today's column. It took a similar downside path into January, bottoming out with the world markets. The recovery since that time has been slow and steady, with a graceful series of rally waves followed by shallow pullbacks.

Progress stalled several weeks ago after the fund reached the 62% retracement of the November-to-January selloff. It's been moving sideways since then in a developing triangle pattern, with resistance over $64.20. A rally through that price level would offer a good entry signal for a run up to the 2007 high at $69.14.

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iShares MSCI Canada Index (EWC)

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Source: eSignal

The iShares MSCI Canada Index (EWC) ETF rallied to an all-time high at $36.68 in November and dropped 10 points before printing a major low in January. It jumped back into the low-$30s in the next month and then dropped into a basing pattern until April 16. The fund broke out above base resistance on that date and rallied up to $33.61.

Price has been pulling back for the last week or so, filling the breakout gap and testing new support levels. These levels should hold and give way to a continued recovery. Accumulation is relatively weak, so I doubt this fund will surge quickly back to the 2007 high. Instead, look for a slow and steady uptick that lasts into the third quarter.

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Alan Farley provides daily stock picks and commentary with his "Daily Swing Trade" newsletter.

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