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by John Nyaradi

Last week's dramatic move by the Federal Reserve to embark on an open-ended program of quantitative easing electrified global markets, and followed Mario Draghi's pledge to buy an unlimited amount of bonds to help defuse the European debt crisis. The aggressive moves by the two most powerful central bankers in the world sent all asset classes soaring, so there are many candidates for "ETF Tip of the Week," including ETFs in the precious metals, commodity, and energy sectors.

However, iShares MSCI Spain Index ETF (NYSEARCA:EWP) wins for the week as it was up 1.3% on Friday and is up 22.5% over the last month and 28.7% for the last three months. On a fundamental basis, Spain's ETF is likely to continue its current trajectory as the ECB moves to contain the European debt crisis. Spain is the 12th largest economy in the world and the fifth largest economy in Europe after Germany, France, Britain, and Italy. As such, Spain is simply "too big to fail," so Europe will move heaven and earth to keep Spain afloat -- not only for itself, but due to the potential threat of contagion moving up the ladder to Italy should Spain fail.

The recent action by the ECB has already driven Spain's 10-year bond yields down from recent high of 7.6% to a more "reasonable" 5.7%. And the country's leaders are preparing yet more austerity programs to qualify for more European largesse.

Of course, it's not all sunshine and flowers as large weekend protests occurred in Madrid, the country is in a deep recession, and unemployment is at depression-like levels. Still, it appears as if new austerity policies are due to be announced on Sept. 27. It's looking increasingly likely that Spain will request an official bailout from the European Union even before the European finance ministers' next meeting, scheduled for Oct. 8.

On a technical basis, "all systems are go" for Spain.

Source: StockCharts.com.

In the point and figure chart above, we can see how iShares MSCI Spain Index ETF registered a "buy" signal on Aug. 17 and also broke above its red bearish resistance line, which is indicative of a new bull market. The point and figure price objective is $51, some 70% above current levels.

No one knows if QE3 and the European Central Bank's bond buying will be successful, but for now market participants seem to be betting on Spain's survival and higher global asset prices ahead. Coming from extremely depressed levels and as a major player in the European debt crisis, Spain and its ETF -- iShares MSCI Spain Index -- seem poised for a strong bull run ahead.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Source: ETF Tip Of The Week For Sept. 17