Wednesday, August 20, 2008
RedDirts BricTrade Update
The candlestick pattern your looking at is what is known as an abandoned baby. If you click on the chart for the China ETF, symbol=FXI you will see this pattern has developed over the past three days. The pattern is confirmed by looking at the Historic Price Quotes at stockcharts.com.........I just had to make sure the shadows of the doji were totally isolated from the Monday lows and the Wednesday lows. So there it is, an abandoned baby reversal pattern. I wish my BRAIN could recall the success rate of this candle pattern. I recently read an article in S&C Magazine that gave the stats on success rates of several candle reversal patterns. Of course I can't locate the article when I need it. But, here is what I'll do. I'll buy an opening position of say 100 shares in the FXI and set a Stop-Loss Order just below the low of that abandoned baby doji. I would like to get filled somewhere below the close on Wednesday and somewhere above the top of the abandoned baby doji. So it looks as though I'll have to place a limit order to try and get filled in that space. This trade is supported by what I'm seeing in all the BRIC trade charts including the Hong Kong Option Index. ($HKO) India actually appears to be a buy at this time also. Brazil and Russia seem to have made some kind of bottom. I think within' this past week or so, there have been some agreements made among the BRIC countries and the USA. Looks as though the best trade could be long China and USA to the detriment of Brazil, Russia and India. But, as I see it, invest in growth in the US and China and look to find some sort REIT investment in Brazil. Look for an infrastructure investment in Russia to go with this trade. I think the best India trade may have something to do with technology (SAY) or I'll just buy a small portion of INP.
Labels: BRIC ETF's, candlestick charts, growth stocks, major indices, RedDirts BRIC Trade, technical analysis
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