ETF PowerRatings Strategies for Traders: 3 Top-Rated Oversold Opportunities in Industrials, Overseas
It may not be raining 10-rated ETFs, but with the sell-off on Friday leaving many ETF markets significantly oversold, there are an exceptionally high number of ETFs that have our highest PowerRatings of 9 or 10.
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Let’s take a look at some of the top rated ETFs that traders will be keeping an eye on as we begin the trading week:
Two of the most oversold ETFs in our database have earned ETF PowerRatings of 10 as of the open on Monday. One of those ETFs is the Industrial Select Sector SPDR ETF
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XLI has closed lower for three out of the past four days above the 200-day moving average, helping the ETF earn our highest rating. The fund has a 2-period RSI of less than 5.
The other exceptionally oversold ETF I wanted to highlight is a country ETF, the iShares MSCI United Kingdom Index Fund ETF
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EWU has also closed lower for three out of the past four trading days. But even with the positive day on Friday, the fund remains significantly oversold with a 2-period RSI of less than 5. EWU is at oversold extremes not seen since July.
The last ETF in today’s report for ETF PowerRatings Strategies for Traders is the Vanguard Total Stock Market Fund ETF
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VTI, for traders who are not familiar with this fund, is based on the MSCI U.S. Broad Market Index. This index includes all of the common stocks traded on the NYSE and is one of the most diversified equity ETFs available to traders and investors alike.
Going into trading on Monday, VTI had also closed lower for three days in a row before bouncing mildly on Friday. That bounce has not changed the potential attractiveness of VTI as a high probability ETF trade, however, insofar as the ETF still has a 2-period RSI of less than 6 and, of course, an ETF PowerRating of 10.
David Penn is Editor in Chief at TradingMarkets.com.