Millions of soccer fans around the world await the most important global sporting event, the 2014 FIFA World Cup. Many media outlets have already started to hype different stocks, as well as statistics about the event. This brings about a question for us traders: Who is going to win and how can we profit? As technical traders, who study and trade from the charts, we are one step ahead of the news, and possibly even the game! With that in mind, let's look to the iShares MSCI Brazil Index (ETF) (NYSEARCA:EWZ) to help us pick the winning nation by analyzing the chart.
We can clearly see the iShares MSCI Brazil Index (ETF)(NYSEARCA:EWZ) is retesting a major trendline break out, with the 200-day moving average just below the trendline. This could serve as minor short-term support. However, the chart has begun to consolidate right at the line, without getting any significant bounce, as of now. The longer the price remains around this level, the more likely the iShares MSCI Brazil Index (ETF)(NYSEARCA:EWZ) is to break down.
If this trendline is broken the iShares MSCI Brazil Index (ETF)(NYSEARCA:EWZ) will fall quickly. A major support level where the shares will find buyers is $42.49.
If the level mentioned ($42.49) happens to be hit towards the end of the World Cup, and Brazil is still in the tournament, then the EWZ will rally (among other factors) in part as a result of Brazil winning the 2014 FIFA World Cup from this level of support.
That is my prediction based on the charts. Please feel free to comment and make your own predictions. Let us know if another chart is telling you who will win the 2014 FIFA World Cup! I would love to hear your thoughts, feel free to comment on our google+ page, our facebook fan page or tweet at me.