Stopped out of URA at $15.73

The Uranium ETF fell sharply today (- 17%) due to the events taking place in Japan and causing prejudice to the nuclear energy. To the contrary, equities linked to renewables energies (solar, wind, geothermal) went up strongly.

Energy ETF chart analysis

The daily chart of the Energy Select Sector SPDR (the "Energy ETF") clearly shows the end of the uptrend of energy stocks.  Next move? Probably a consolidation in the next few weeks.

Interesting to see what the chart of the opposite ETF says. In this case, we are speaking about the ProShares UltraShort Oil & Gas (ticker: DUG on NYSE): you make profits when oil & gas equities drop.

S&P 500 index chart analysis

The S&P 500 index is currently delivering us a classic technical figure called "symmetrical triangle". The symmetrical triangle appears after a strong uptrend or downtrend and shows the indecision of investors and the fight that is taking place between the bulls and the bears. Generally, this technical figure is a continuation figure: the trend that precedes the appearance of the symmetrical triangle continues. However, the move that occurred on March 10 was an exit of the triangle to the downside after an uptrend took place. This means that the probability is higher that a downtrend is now starting.

To change my mind, I would need to see the S&P 500 index return to the 1340 price zone and then break out to the upside. But I think this scenario is unlikely to happen.

Volatility index chart analysis

Weekly chart of the CBOE Volatility index (VIX):
- bullish divergence between the MACD and and the VIX price
- VIX reached the support area and started to move higher
- the scenario I have in mind? a move up

US Dollar index chart analysis

Monthly chart of the US Dollar Index:
this is the scenario that I have in mind for the next few months: a move up to around 83-84.

Selling DBA at $34.42

Selling today my position in the PowerShares DB Agriculture Fund ETF (DBA) with a return of +32.4% compared to my purchase price of $25.99 paid on November 24, 2009.

EUR-USD chart analysis

 

Weekly chart of the EUR/USD:

- price has reversed at the approach of the down trendline that joins the previous highs of July 2008, November 2009 and October 2010

- I am now becoming bearish on this currency pair and expect a return to 1.20

- If EUR/USD goes above the trendline and stays there for more than a week, I would change my mind

Buying the Colombia ETF

The Global X Interbolsa FTSE Colombia 20 ETF (ticker: GXG on the NYSE) is a market capitalization-weighted index of the 20 most liquid stocks in the Colombian market.
Top 10 holdings include:
- Pacific Rubiales (17.2%): natural gas and oil company
- Ecopetrol (16.1%): biggest Colombian oil producer
- BanColombia (14.9%): biggest Colombian bank
- Grupo Aval Acciones y Valores (5.3%)
- Cementos Argos (4.7%)

Colombia is one of the so-called promising "frontier markets".
The Global X Interbolsa FTSE Colombia 20 ETF is the only ETF that offers exposure to the Colombian stock market and allocates around 34% to the oil and gas industry.

Fundamental reasons to invest in Colombia:
- this nation is very rich in natural resources: oil, coal, natural gas, gold, silver, nickel, platinum
- the country has the largest coal reserves of South America and, among the Latin American countries, is just behind Brazil for its hydroelectric potential
- political stability has been gradually improving over the last 10 years with strong decline in violence and number of kidnappings
- foreign direct investment in the country has quadrupled in the past decade to reach more than $9 billion in 2010
- inflation is under control: 2.6% in 2010
- Colombia is pursuing free trade agreements with Asian and other South-American nations to export its resources, in particular oil and coal

Technical reasons to buy now:
- price has retraced to the 200 day moving average and then rebounded
- a bullish divergence appears on the above chart between the price and the MACD

I am buying this ETF today at $40.87 for a total of $10,000. Stop loss: $34.