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Trends & Analysis
News
Norwegian Cruise has a rocky journey in Q2
News
Could eBay bounce this week?
News
BioNTech’s shares shorted after disappointing Q2
News
Western Digital’s stock down despite upbeat print
News
Alibaba delivers upbeat print, shares rise
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Is gold in trouble?

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Asset Watch

Will the ARK Innovation ETF stay afloat this week?

 

Tuesday, July 12, 2022, 10:20am GMT

With the ARK Innovation ETF going from riding the pandemic wave higher in 2020/2021 to drowning in 2022, Cathie Wood’s flagship investment fund has suffered recently.

 

With higher interest rates poised to slow the U.S. economy, investors have rotated from value to growth stocks in recent weeks. So, could shifting sentiment help buoy the ARK Innovation ETF?

Source: TradingView

Looking back, breakouts above the 10-week moving average coincided with rallies that lasted roughly one to four months. The 10-week MA also acted as support numerous times during the ARK Innovation ETF’s vertical ascent from April 2020 to February 2021.

But after back-and-forth trading from May through November 2021 gave way to a waterfall decline in 2022, the ARK Innovation ETF has only managed three closes above its 10-week MA. The first occurred in late March and was followed by another sharp drawdown. The second occurred two weeks ago and was followed by a 10% drop the next week.

However, with the 10-week MA at $43.30 and the ARK Innovation ETF ending last week at $46.86, a third rendition has materialised. While the weekly closes in late March and June were only 2.4% and 3.1% above the 10-week MA, this week’s close was 8.22% above the 10-week MA.

As a result, the ARK Innovation ETF is showing its first signs of life in 2022: but will the good times last?

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