Australian Stock Market Is On the Upside

The Australian All Ordinaries (^AORD) is at all-times highs driven by the boom in mining and natural resource stocks. The second phase of the three-year upside is almost parabolic and it cannot be sustained.

A low-cost way to play the Australian stock market and the boom in commodities is to own iShares MSCI Australia Index (EWA), an exchange-traded fund (ETF). Currently EWA is on a steep upside that cannot be sustained. Buy EWA only on price dips.

Posted May 8, 2006.