Macro worries have sent stock markets all over the world spiraling down. Inflation increased prices, and decreased consumer spending due to less discretionary income means slowing GDP growth. We saw this when U.S GDP declined in the first quarter by 1.4%, missing the consensus for 1% growth.
The technicals for the Japanese stock market also look terrible with the market in a downtrend since September. The Professor has Identified a classic bear flag set up in the Japanese market and is looking to get short!
iShares MSCI Japan ETF (EWJ)
The iShares MSCI Japan ETF (EWJ) seeks to track the investment results of an index composed of Japanese equities.
Its largest holdings include stocks such as TOYOTA MOTOR CORP, SONY GROUP CORP, MITSUBISHI UFJ FINANCIAL GROUP INC, NINTENDO, and SOFTBANK.
EWJ has been in a steady downtrend since it made all-time highs in September 2021. It is currently down over 20% off these highs and could break down even further.
Here’s what the Professor sees from the Technicals sent out to subscribers yesterday afternoon. The Professor is live every day in Master’s Club running through market analysis, and usually has one or two trade ideas for subscribers every day! Mike Parks is Raging Bull’s Senior Training Specialist. Mike is a veteran trader and educator and is adding a level of insight to Total Alpha that can only come from decades of experience in trading and market education.
Mike has incredibly knowledgeable on all things markets and his talent for teaching new traders how to use market signals to choose the right options strategies is unmatched.
The Professor’s Pick- EWJ:
Trade Setups:
- Break of Support: Break of support is showing the bears are taking control and pushing the stock lower from here.
- TTM Squeeze: The TTM Squeeze is showing a red dot and negative momentum. This could confirm the trend to the downside once the bears step in and take control.
- On Balance Volume: OBV bearish as sellers jump in here for lower prices.
Trade Details:
- Entry below line
- Target 1 : $55.49
- Target 2 : $54.78
- Target 3 : $53.99
- 20 May 56 puts
