News From Australia Sets Up a Potential Trade

Australian authorities rejected Archer-Daniel-Midland’s (NYSE: ADM) proposed buyout of GrainCorp, an Australian grain producer. The decision took analysts by surprise and led to weakness in Australian stocks. That weakness may lead to a buying opportunity in iShares MSCI Australia Index Fund (NYSE: EWA).

PowerRatings are based on the relative strength or weakness of particular stocks or ETFs. The higher the rating, the greater the one week historical gain has been for stocks and ETFs with that rating. For best results, enter these trades with a limit order 3-7% below the previous day’s closing price. Higher % limit entries have historically shown a greater percentage of winning trades but higher % limit orders also reduce the chance of trade execution.

In the past, buying stocks with a rating of 10 on a 3% pullback the next day and selling five days later has been profitable 75% of the time. The average winner has gained 5.9%. Other entries and exits also show high winning percentages and large average gains.


In the short-term, EWA is oversold with a PowerRatings of 10 and the ETF could be a buy under $24.72.

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All data is as of the end of day on 11/29/2013.