SEA (Claymore/Delta Global Shipping ETF @ 16.10) broke out of a 7-month bear channel after posting a 52-week low at 14.40 (15 November 2012). The recent pullback off the 16.17 high (20 December) found support at 15.79 (31 December low) ahead of the former bear channel resistance now support at 15.50. With the daily momentum indicator shifting higher, there is scope for further upside. Clearance above 16.17 would confirm bullish continuation and initiate the next upleg towards 16.87 (9 May 2012 high, near the channel height target and the 50% retracement of the 19.31/14.40 downswing). Further strength above there would open 17.30 (23 April 2012) which guards 18.10 (30 April 2012 high).
It would take a move below the 15.50 support to delay bulls and shift the immediate focus back towards the key 7-month zone 14.98/14.92 (28 November/31 August lows).
Trading Indication:
Short-term:
Buy Entry: near 15.79;
Target: 16.87 initially (6.8%) and higher;
Stop Loss: below 15.50 (2%)
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