ARK ETF Analysis
Today we will analyze several ARK Invest ETF charts.
During 2020, ARK Invest ETFs were leaders in their categories producing impressive gains.
I won’t discuss their yearly performance, as that topic is out of the scope of this newsletter, and a number of the readers are fully aware of their outperformance.
The question that every current or potential holder of these ETFs is asking themselves and others is, ‘Is the price trending up or is it trending down?’.
The price is all that matters.
Not my opinion of the fund sectors.
Not my opinion of the fund holdings.
Not my opinion of the fund managers.
Only the price.
As traders or investors, we do not want to fall in love with a company or an ETF.
We try to keep the emotion out of the position, and I try to only look at the ticker and not worry about the name.
I do not want to fall in love with a position.
All I care about is if the price is moving up and to the right.
That is all.
Let us look at the ARK ETF charts and determine if the trend is up and to the right or if the trend could be changing.
ARKF Fintech Innovation ETF
As the chart below shows, the current price is below the Year-to-date (TYD) VWAP, the Volume-Weighted-Average Price (VWAP) from the March 18, 2020 low and the VWAP from inception.
This means that the average price paid for this ETF since inception is losing money.
The price is currently at the purple 200 Day moving average, a level where buyers are often found.
I anticipate a bounce to the level of the yellow and green VWAPs.
If this happens, then I will monitor the price action and reassess.
If the price can get above those VWAPs, then I get bullish.
If you are losing money on an investment, are you more likely to add to the position or exit it?
A full candle below the 200 DMA signals a trend change and could send this ETF much lower.
ARKQ Autonomous Technology & Robotics ETF
ARKQ is breaking down below the VWAP from the March 18, 2020 low.
Below today’s price is the confluence of the green VWAP from inception and the purple 200 DMA.
Often, either of these on their own will bring buyers in, and a bounce or reversal occurs.
This confluence increases that likelihood.
ARKW Next Generation Internet ETF
ARKW made a new low is now a full candle below the purple 200 DMA and the yellow VWAP from the March 18, 2020 low.
It is said that nothing good happens below the 200 DMA, and this is a signal that the longer-term trend is changing.
This is bearish.
Yes, the price could bounce here; however, I avoid positions beneath the 200 DMA and will only enter to scalp on a short timeframe.
There is potential support below and I will wait and see if the price tests the green VWAP from inception.
ARKG Genomic Revolution ETF
ARKG is a nasty-looking chart with today’s full candle below the purple 200 DMA and the green VWAP from inception.
Recall that the VWAP from inception represents the average price paid per unit per share.
This means that today’s price is below the average price paid per share since inception.
There is potential support below; however, this is a bearish chart to me.
ARKK ARK Innovation ETF
This is an example of a chart that I avoid. The price is below the purple 200 DMA and the green VWAP from inception. This is bearish.
ARKX Space Exploration & Innovation ETF
This thing is a disaster making a new Daily low and is well below the VWAP from inception.
I don’t have anything more to say about this one.
I hope that you find this analysis beneficial and share it with others.
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