ETF Outlook For Thursday, May 29, 2014 (QCLN, TLT, UNG, TSLA, UUP)
ETF Outlook for Thursday, May 29, 2014
First Trust NASDAQ Clean Edge Index ETF (NASDAQ: QCLN)
Eight U.S. states plan to increase the number of electric vehicles on the road to 3.3 million by 2025, using a combination of incentives, dealer promotions, and an expansion of recharging stations. That would be a big jump from the current 200,000 vehicles.
Tesla Motors (NASDAQ: TSLA) could be the big winner as the country continues to move towards the widespread adoption of electric vehicles. TSLA makes up 7.5 percent of QCLN and is the second largest holding in the ETF.
The ETF is up five consecutive days and therefore could be set for a slowdown to end the week, but longer-term the news is positive.
Related: ETFs on the Move After Memorial Day
iShares 20+ Year Treasury Bond ETF (NYSE: TLT)
Money continues to flow into U.S. Treasuries as bond yields fell to the lowest levels in nearly a year.
The yield on the 10-year Treasury fell to 2.43 percent Wednesday, breaking major support at the 2.47 percent level. Technically speaking the yield on the 10-year does not have any significant support until it gets down to the 2.0 percent area, which would have a major ripple affect across both bond and equity markets.
The bond ETFs have been moving higher on the news with TLT up 1.2 percent to close at an 11-month high.
U.S. Natural Gas ETF (NYSE: UNG)
Up another 2.6 percent Wednesday, UNG is back to a three-week high at $25.47. The ETF has been in a fairly narrow trading range over the last few months as it continues to find support at the $24 area. Last week the ETF fell back to $24 again before it regained it’s footing.
A major breakthrough for UNG would be a close above $28, which could be the first leg in a sustainable uptrend.
PowerShares U.S. Dollar Index Bullish ETF (NYSE: UUP)
The greenback has been drifting higher as the Euro hits multi-month lows and the British Pound starts to break down. Yesterday UUP closed 3 cents below the best closing level since early February and today could be setting up for a mini-breakout.
The long-term trend remains bearish, but in the near-term the ETF could make a move to the $22 area as its peers continue to fall in value.
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