Over the past few days, we have pointed out the bullish chart patterns in three different Asian ETFs: South Korea ($EWY), Hong Kong ($EWH), and China ($PGJ).

One ETF that nicely encompasses these specific regions is iShares All Country Asia Ex-Japan ($AAXJ). By country, the top portfolio holdings that comprise $AAXJ are: China 25%, South Korea 20%, Taiwan 15%, Hong Kong, 13%, and India 8%.

With the majority of its portfolio exposure comprised of solid chart patterns of individual ETFs, $AAXJ is now setting up for a potential downtrend line breakout on multiple time frames.

On the long-term monthly chart (below), we see the price action of $AAXJ is now sitting above the downtrend line. If this ETF can break above the high of November's bullish reversal candle, it could potentially rally to the prior highs of 2011 (around $65):



Next, let's drop down to the shorter-term daily chart of $AAXJ:



Notice the 50-day moving average has crossed above the 200-day MA, which is a bullish moving average crossover.

The price action of this ETF has tightened up nicely over the past few weeks, as it has held above the 20 and 50-day moving averages. With both the 20 and 50-day moving averages now pointing in the right direction, it looks as though $AAXJ could be poised for a breakout within the next week or two.

Deron Wagner is the Founder and Head Trader of both Morpheus Capital LP, a U.S. hedge fund, and MorpheusTrading.com, a trader education firm.