PowerShares DWA Technology Momentum Portfolio (PTF) — This ETF seek to mirror the investment results of the price and yield of the DWA Technology Technical Leaders Index. This index consists of at least 30 tech stocks that have powerful relative strength characteristics from about 2,000 of the largest companies by market capitalization within the Nasdaq US Benchmark Index. As of this writing, top holdings include Apple (AAPL), Equinix (EQIX) and Sunedison (SUNE).
Technically, PTF is in a well-defined bull market with a support line at just under $42 and resistance at about $45. The early May low of $40.26 was successfully tested by the June reversal at $41.10, accompanied by very high volume that is interpreted as a selling climax. Last week, that reversal was confirmed again when four successive closes pierced the 50-day moving average, which now stands at $42.77. Also last week, positive tape action also triggered a new MACD buy signal.
Although not considered a quick trade, this investment could result in a six-month trade with an objective of $50 and a return of more than 15%. A stop-loss order should be placed under PTF’s 200-day moving average at slightly under $40.
Traders should review the portfolio of PTF for trading ideas that could outperform the index over a shorter period of time.
