Disruptive technology and science has become one of the biggest driving forces in global market acceleration over the past 20+ years. Many of you remember the DOT COM rally and how that technology disruption, even in an infancy stage, dominated market trends. Now, 20+ years later, many of the same technology companies that got started in the late 1990s are global powerhouse technology firms commanding massive price valuations. Are there other “moonshot” firms out there and, if there are, how can we take advantage of this new disruptive technology today?
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My team and I believe one of the biggest and newest technologies that stands a strong likelihood of creating a new industry and disrupting existing concepts is the Space Sector. Virgin Galactic (SPCE), SpaceX, and Blue Origin are racing to create consumer space solutions including reusable travel, exploration, recreational, and other new industries. Over time, as this technology continues to provide greater and more varied solutions, just like the late 1990s internet boom, the opportunities for traders could be incredible.
21st Century Disruptive Technology ETF May Present Real Opportunities
Currently, the MOON (Direxion Moonshot ETF) includes various innovative sectors – including the Space sector. The distribution of this ETF includes Genetic Engineering, Cyber Security, Virtual Reality, Digital Communities, Drones, Distributed Ledger, Robotics, Smart Technology, and many others. In terms of disruptive technology and the potential for a moonshot return over the next 16+ months, this ETF appears to be uniquely positioned for substantial gains if the current trend continues.
MOON ETF Sector Holdings
This Daily MOON ETF chart highlights the recent upside price rallies that have broken above the downward price trend channel on fairly weak volume. We believe this upward breakout move may consolidate because of the low volume trend. But we also believe this breakout trend may be the start of a move higher as the global economy transitions towards new disruptive technologies and the opportunities of new consumer space exploration/industries. One thing to remember about this MOON ETF is that it is somewhat new (less than 12 months since it started), but includes a number of potentially large innovative sectors and symbols. The opportunities for traders related to this expanding disruptive sector ETF could be impressive over the next 4+ years.
MOON Needs To See Increasing Volume To Sustain A Stronger Rally Phase
This Weekly MOON ETF chart highlights the very mild volume recently within the current uptrend. We believe a moderate sideways price correction may happen after the recent upside breakout trend which may prompt a new momentum base setup near $34~$35. If our research is correct, accumulation will start to happen over the next 5+ months in MOON which will setup a new momentum base price level. From there, a larger upside price rally may prompt a move above $45 to $50.
We would like to see volume levels climb higher as this momentum base nears completion and when the upward price trend really starts to accelerate. At these lower volume levels, we are starting to see some accumulation from traders, but the volume levels suggest MOON has not reached a true upside momentum rally phase yet.
UFO News Is Hot Right Now. Are You Ready For The Next Opportunities In Space?
Another interesting ETF for traders to consider is UFO. This ETF is more focused on space-based technologies and solutions. Generally, it focuses on anything “space-related” and would be an interesting candidate for traders that truly believe in the long-term disruptive capabilities of the current US and global race to space.
The renewed efforts to turn space into a private and consumer based “new frontier” opens nearly unlimited opportunities to those who are able to find a way to engage and profit from this in the near future. Obviously, it is not cheap to fly into space and/or engage in any type of profitable enterprises in space. But, the unknown factor related to raw materials, space mining, broad range exploration and consumer space travel could be something that becomes very real over the next 20+ years.
This Daily UFO chart shows, like the MOON chart does, an upward price trend breakout that supports a new momentum base near $28~$29. If this trend continues and we start to see volume levels increasing, we may see UFO trading above $33 to $35 before the end of 2021.
Thinking outside the box/planet for a moment – on June 29th, we could have some very interesting news, data, and facts about actual UFOs seen by militaries around the world with a declassified report being released by the Pentagon. Not the most comforting thought as this type of UFO (Unidentified Flying Object) may also include secret drones/planes. This could be headline news over the next month or two and draw some attention to sectors such as Space Tech and ETFs like UFO.
In this article, we have highlighted two unique ETFs that allow traders to engage in disruptive technologies from different perspectives. The MOON ETF is a more broad-based innovator ETF that includes Terran-based innovators and space technology firms. The UFO ETF is more exclusively focused on space-related technologies and opportunities.
Traders want to stay ahead of these trends and opportunities related to what may become the next big disruptive technology gains. As we move further into the 21st Century, it is very likely that space will become the DOT COM/Internet disruptive technology over the next 20 to 40+ years (or longer). That means traders need to start considering how this exciting new sector fits into their investment portfolio and where new industry leaders will settle.
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Have a great day!
Chris Vermeulen
Founder & Chief Market Strategist
www.TheTechnicalTraders.com
