Recent weeks have seen a dramatic shift toward global stocks as U.S. markets decline. Now traders may be looking for a breakout in a key ETF tracking the group.
The iShares MSCI EAFE fund, which focuses on developed markets like Europe and Japan, had a quick advance from mid-January through early March. There are at least four takeaways from the rally.
First, it resulted in historic outperformance against the S&P 500. (This is highlighted by relative strength in the lower study with a 21-day period.) The current reading of 13.8 percent points compares with July 2002, when EFA began a five-year run of outpacing SPX. (The only two other times that relative strength was higher was late 2008 and March 2020, abnormal moments of extreme volatility.)
Second, the recent rally pulled the 50-day simple moving average (SMA) toward a potential “golden cross” above the 200-day SMA.
Third, a pullback on February 28 was quickly bought. That potentially established support above the December high of $80.63. (See yellow arrows.)
Fourth, EFA has remained well above a 50 percent retracement of the advance. That may confirm bulls are still in control.
Next, the fund just completed an inside week. That tightness may reflect a lack of selling pressure.
Finally, the 8-day exponential moving average (EMA) has stayed above the 21-day EMA.
Standardized Performances for the ETF mentioned above:
iShares MSCI EAFE ETF (EFA)
1-year: +5.61%
5-years: +31.07%
10-year: +25.31%
(As of February 28, 2025)
Exchange Traded Funds ("ETFs") are subject to management fees and other expenses. Before making investment decisions, investors should carefully read information found in the prospectus or summary prospectus, if available, including investment objectives, risks, charges, and expenses. Click here to find the prospectus.
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Past performance, whether actual or indicated by historical tests of strategies, is no guarantee of future performance or success. There is a possibility that you may sustain a loss equal to or greater than your entire investment regardless of which asset class you trade (equities, options or futures); therefore, you should not invest or risk money that you cannot afford to lose. Online trading is not suitable for all investors. View the document titled Characteristics and Risks of Standardized Options at https://www.TradeStation.com/DisclosureOptions. Before trading any asset class, customers must read the relevant risk disclosure statements on https://www.TradeStation.com/Important-Information/. System access and trade placement and execution may be delayed or fail due to market volatility and volume, quote delays, system and software errors, Internet traffic, outages and other factors.
Securities and futures trading is offered to self-directed customers by TradeStation Securities, Inc., a broker-dealer registered with the Securities and Exchange Commission and a futures commission merchant licensed with the Commodity Futures Trading Commission). TradeStation Securities is a member of the Financial Industry Regulatory Authority, the National Futures Association, and a number of exchanges.
TradeStation Securities, Inc. and TradeStation Technologies, Inc. are each wholly owned subsidiaries of TradeStation Group, Inc., both operating, and providing products and services, under the TradeStation brand and trademark. When applying for, or purchasing, accounts, subscriptions, products and services, it is important that you know which company you will be dealing with. Visit https://www.TradeStation.com/DisclosureTSCompanies for further important information explaining what this means.
The iShares MSCI EAFE fund, which focuses on developed markets like Europe and Japan, had a quick advance from mid-January through early March. There are at least four takeaways from the rally.
First, it resulted in historic outperformance against the S&P 500. (This is highlighted by relative strength in the lower study with a 21-day period.) The current reading of 13.8 percent points compares with July 2002, when EFA began a five-year run of outpacing SPX. (The only two other times that relative strength was higher was late 2008 and March 2020, abnormal moments of extreme volatility.)
Second, the recent rally pulled the 50-day simple moving average (SMA) toward a potential “golden cross” above the 200-day SMA.
Third, a pullback on February 28 was quickly bought. That potentially established support above the December high of $80.63. (See yellow arrows.)
Fourth, EFA has remained well above a 50 percent retracement of the advance. That may confirm bulls are still in control.
Next, the fund just completed an inside week. That tightness may reflect a lack of selling pressure.
Finally, the 8-day exponential moving average (EMA) has stayed above the 21-day EMA.
Standardized Performances for the ETF mentioned above:
iShares MSCI EAFE ETF (EFA)
1-year: +5.61%
5-years: +31.07%
10-year: +25.31%
(As of February 28, 2025)
Exchange Traded Funds ("ETFs") are subject to management fees and other expenses. Before making investment decisions, investors should carefully read information found in the prospectus or summary prospectus, if available, including investment objectives, risks, charges, and expenses. Click here to find the prospectus.
TradeStation has, for decades, advanced the trading industry, providing access to stocks, options and futures. If you're born to trade, we could be for you. See our Overview for more.
Past performance, whether actual or indicated by historical tests of strategies, is no guarantee of future performance or success. There is a possibility that you may sustain a loss equal to or greater than your entire investment regardless of which asset class you trade (equities, options or futures); therefore, you should not invest or risk money that you cannot afford to lose. Online trading is not suitable for all investors. View the document titled Characteristics and Risks of Standardized Options at https://www.TradeStation.com/DisclosureOptions. Before trading any asset class, customers must read the relevant risk disclosure statements on https://www.TradeStation.com/Important-Information/. System access and trade placement and execution may be delayed or fail due to market volatility and volume, quote delays, system and software errors, Internet traffic, outages and other factors.
Securities and futures trading is offered to self-directed customers by TradeStation Securities, Inc., a broker-dealer registered with the Securities and Exchange Commission and a futures commission merchant licensed with the Commodity Futures Trading Commission). TradeStation Securities is a member of the Financial Industry Regulatory Authority, the National Futures Association, and a number of exchanges.
TradeStation Securities, Inc. and TradeStation Technologies, Inc. are each wholly owned subsidiaries of TradeStation Group, Inc., both operating, and providing products and services, under the TradeStation brand and trademark. When applying for, or purchasing, accounts, subscriptions, products and services, it is important that you know which company you will be dealing with. Visit https://www.TradeStation.com/DisclosureTSCompanies for further important information explaining what this means.
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The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.