Alt Energy ETFs Are Experiencing Near-Term Downtrends
18 November 2009 at 3:10 pm by Gary Gordon
Meredith Whitney may be more bearish than she’s been in a year. Yet, stock investors keep pushing all major sectors and all key market barometers upward.
Sure, there are a number of noteworthy areas of trepidation. Financial stocks have NOT hit new 52-week highs in more than a month. Small-caps have been underachieving. And Market Vectors Vietnam (VNM) has corrected 11% from highs reached on 10/15/09… a troublesome sign for frontier market investments.
Still, none of the above-mentioned areas have entered bonafide downtrends. That unique honor goes to a number of Alternative Energy ETFs, including: (1) Global Wind Energy (FAN) and (2) Global Solar Energy (TAN).
Ironically, Obama’s sweeping White House victory was supposed to galvanize alt energy investing. With government imposing stricter regulations on the oil industry… with more ”green” jobs… with more tax incentives for enviro-friendly businesses… solar and wind company shares were supposed to surge.
So what went wrong?
One could (and should) make the point that oil’s precipitous collapse from $150 per barrel in mid-08 to $40 per barrel at the start of ‘09 killed the immediacy for alt energy. After all, it was the insane price on old energy that fueled the call for innovation.
However, oil has since climbed back to $80 per barrel. With 100%+ gains in the spot price of crude as well as 20%+ gains in Global Energy (IXC) in ‘09, shouldn’t this have ignited FAN and TAN?
Unfortunately, there hasn’t been a sustainable spark in Global Solar (TAN); rather, TAN has been hitting “lower lows” since June. It’s also given up a bearish 19% or more from its summertime top.
Global Wind (FAN), on the other hand, had been leading Global Energy (IXC) throughout the year… until now. Whereas IXC appears poised to pursue new 52-week peaks, FAN ran out of steam back in September. Not only is it off 6% from highs reached 2 months ago, but FAN is below a 50-day moving average.
If you’d like to learn more about ETF investing… then tune into “In the Money With Gary Gordon.” You can listen to the show “LIVE”, via podcast or on your iPod.
Disclosure Statement: ETF Expert is a web log (”blog”) that makes the world of ETFs easier to understand. The content does not represent investment advice, nor are the securities discussed suitable for every investor. Pacific Park Financial, Inc., a Registered Investment Adviser with the SEC, may hold positions in the ETFs, mutual funds and/or index funds mentioned above. Investors who are interested in money management services may visit the Pacific Park Financial, Inc. web site.
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