A Rebound Expected In The Direxion Daily Large Cap Bear 3X Shares ETF (SPXS)

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April 24, 2013 1:37pm NYSE:SPXS

direxion_logoTrading Central: From a technical view, the ETF has broken above a key declining trend line which has been in place since November 2012.


Regarding technical indicators, the daily RSI has broken above a bearish trend line and a rising trend line maintains bullish stance. Furthermore, the daily MACD is pushing above its signal line.

On a relative basis against the S&P500, the Direxion Large Cap Bear 3X Shares has pushed above a bearish trend line and looks set for a rebound.

Trading strategy:
Buy @ $11.83 – Stop loss @ $11.30 – Target @ $14.05

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Product description

The Daily S&P 500® Bear 3x is a leveraged inverse ETF that seeks daily investment results, before fees and expenses of -300% of the performance of the S&P 500® Index. This fund is more volatile than a non-leveraged ETF and should not be expected to provide three times the return of the benchmark’s cumulative return for periods greater than a day. There is no guarantee that fund will meet its stated investment objective.


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Glossary
MACD: this indicator (Moving Average Convergence / Divergence) reflects a difference between moving averages and refers to the ascendancy or not of the mid-term relative to the short term. The considered average lengths are respectively 26 days (0.075 exponential coefficient) and 12 days (exponential coefficient of 0.15). RSI: (Relative Strength Index) a technical indicator which measures the magnitude of gains over a given time period against the magnitude of losses over that period. The equation is RSI = 100 – 100 / (1 + RS) where RS = (total gains / n) / (total losses / n) and n = number of RSI periods

For more information on Direxion ETF go to: http://www.direxionfunds.com/


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