The monthly chart below of the South Korea ETF (EWY) shows January's breakout to new all-time highs, followed by a brief pullback and rally back to close above its prior record high of 75.05 in March (now near-term support). Price is cautiously extending these gains, so far this month, while experiencing quite a bit of whipsaw movement on a daily basis.
It's also sitting just above the bottom of a long-term uptrending Andrew's Pitchfork channel around the 70.00 level (major support). Its next major support level is around 60.00 on this timeframe.
Both the momentum and rate-of-change indicators have been waning since last October, but remain above zero. A drop and hold below zero, as well as price drop below 70.00, could see price retest 60.00, or lower.
The daily chart below of EWY shows this whipsaw action (which began last October and which has formed a diamond pattern), and volumes have been high for the past couple of months.
Price is still above the 50-day MA and the RSI, MACD and PMO indicators have just formed a new "BUY" signal. However, this diamond pattern can be a bearish topping formation after a lengthy run up, so a certain amount of caution is warranted, especially with price near its recent all-time high.
Beware of a break with force on escalating volumes below the diamond bottom around 70.00 (which sits below the 200-day MA) as price could very well drop back to 60.00, or lower.
We'll see what happens following Friday's opening talks between the North and South Korean leaders to denuclearize the Korean peninsula and forge a peace agreement, and how further discussions may affect the EWY over the coming days/weeks, particularly in the lead-up to President Trump's proposed meeting with Kim Jong Un in the next couple of months.
* UPDATE April 30...
However, judging from NOKO's past violations of all previous nuclear agreements over the years, I wouldn't hold my breath that the words "Nobel Peace Prize" and "North Korea" will ever appear in the same sentence, despite what some are now excitedly hypothesizing.
Leopards (predators) don't change their spots...they only wish to make themselves relevant by pretending that they will...so, the onus is on Kim Jong Un to be the first to do so on that front and prove that as a verifiable and irreversible fact, while holding onto his power and control in NOKO...good luck with that.
|Source: Reuters.com April 30/18
* UPDATE May 16...
Now that Kim Jong Un is revealing his true intentions (with his return to inflammatory rhetoric these past couple of days) that he will not actually disarm and denuclearize NOKO and that his recent (and past) words and promises to do so are empty, I really don't see any good reason for President Trump to meet with him in June. What's the point?
Once again, Chairman Kim is just show-boating and wasting everybody's time with his propaganda and insincerity...and still wearing his leopard skin...that's clear for all to see. He craves and loves attention and limelight and is a nobody without it.
Let him remain a nobody, Mr. President. Instead, use your time more wisely to further fulfill your election agenda to your citizens, including protecting their national security and economic well-being.
* UPDATE May 24...
President Trump cancels the June 12th summit with North Korea after North Korea failed to show up for scheduled pre-summit meetings in Singapore (while U.S. representatives waited there for 3 days) and didn't answer repeated phone calls for days on end, as well as made new threats of a nuclear orgy...
|Twitter Link to video
And, once again, childish and anti-American/national security rhetoric come from Democrats (and, most of the media) in order to mock President Trump (it sounds like they're on North Korea's side and don't want the U.S. to succeed with peace-making efforts)...
* UPDATE May 25...
Mr. President, I repeat...don't waste your breath on North Korea.
Kim and his regime are clearly not serious and will never completely and irreversibly denuclearize and give up their weapons. Nor will they ever allow full and transparent inspections or allow their citizens to enjoy peaceful democratic freedom. They do not value western democratic principles, so do not expect them to embrace such a concept because it's simply beyond their capability.
* UPDATE June 1...
Final thoughts...I have to wonder why Kim Jong Un would actually trust that, if NOKO did completely and verifiably denuclearize NOKO, blow up all their test sites, and disarm and turn over their weapons to the US (rather than, say, to China), any deal that he might make with this current US President would be upheld and honoured by future Presidents to guarantee the safety and security of him and his regime, in perpetuity. We've already seen how two vastly different Presidents operate under Obama and Trump...and how one administration's policies and agreements can be scrapped with the stroke of a pen.
I just don't see the US and NOKO ever agreeing on what the west really wants.
If some kind of a deal is struck, I wonder just how transparent all the facts will be outlined in any agreement that gets released to the public.
Call me a skeptic...with eyes wide open...