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Tickers in this Article: EWG
Stocks kicked off the week on a positive note as upbeat economic data from China over the weekend was enough to make investors forget about the looming fiscal cliff at homeat least for the trading session. Bullish sentiment swept over Asian markets after investors overseas digested better-than-expected factory output and retail sales data. With no major releases on Wall Street, equity indexes saw little resistance on Monday, and upbeat earnings results from McDonald's set the tone. With no major releases at home taking place, investors will focus their attention on European markets, which are slated to digest the latest German Economic Sentiment survey before the opening bell. As such, our spotlight will focus on the iShares MSCI Germany Index Fund , which may see an uptick in trading activity as investors react to the latest sentiment results from this European powerhouse; analysts are expecting the survey sentiment figure to come in at -11.5, marking a modest improvement from the previous reading of -15.7.

Chart Analysis

This ETF has staged a stellar comeback since mid-November, when it managed to bounce off its 200-day moving average (yellow line), is climbing higher with little rest. EWG's recent upside move is very bullish consideringthe laundry list of loominguncertaintieson both sides of theAtlanticocean. Despite staging a textbook rebound off its 200-day moving average, EWG appears less than ripe from a technical perspective; notice how this ETF is flirting with major resistance around $24 a share (red line), a level which it has failed to summit on several occasions throughout 2012, starting in March and most recently through September.

Click to Enlarge Entering into a long position at current levels is quite speculative seeing as EWG is flirting with a historic resistance level, thereby increasing the probability of a correction in the near-term.

Outlook

If the latest sentiment results comes in better than expected, German equities may have the wind at their backs; in terms of upside, EWG must summit majorresistancearound $24 a share before proceeding any higher. On the other hand,worrisomesurvey results caninspireprofit-taking pressures; in terms of downside, this ETF has support at $23 a share followed by the $21 level.As always, investors of all experience levels are advised to use stop-loss orders and practice disciplined profit-taking techniques.

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Disclosure: No positions at time of writing.

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