High Probability ETF Trading: 7 ETFs You Need to Know for Monday (IGN, IXP, IYZ, VOX, USO, XLE, DIG)
With the proposed acquisition of T-Mobile by AT&T among the top corporate news stories to begin the week, 7 ETFs You Need to Know is featuring some of the telecommunications-related exchange-traded funds that traders and investors alike will need to know for the next few days.
Outside of the world of mergers and acquisitions, the decision to deploy a no-fly zone over Libya has many observers keeping a close eye on the crude oil market. Today will also feature some of the energy ETFs – both equity and commodity-based – that may be making big moves in the near term.
Here are 7 ETFs You Need to Know for Monday.
The most oversold ETF in our database ahead of Monday’s open? The ^IGN^ has closed lower for five days in a row, and seven out of the past eight. All five of the fund’s most recent closes have been in oversold territory.
IGN includes among its top holdings stocks like ^JNPR^, ^QCOM^ and ^CSCO^.
News of ^T^ decision to acquire T-Mobile USA will have many traders taking a new look at not just telecommunictions stocks, but telecommunications exchange-traded funds (ETFs) as well. Here are some of the more widely traded telecom ETFs in the market right now.
The ^IXP^ is among the more popular telecom ETFs. IXP includes among its top holdings AT&T and Verizon (nearly a quarter of the fund’s top 10 holdings) as well as France Telecom and Deutsche Telekom (which owns T-Mobile USA).
Shares of IXP have rallied over the past two days after a deep pullback that took the fund in to oversold territory for three consecutive trading days.
Another popular option for ETF traders and investors looking for telecom exposure is the ^IYZ^.
IYZ also includes AT&T and Verizon as its top holdings. But as a domestic fund, IYZ also includes stock from equipment companies like American Tower Corporation ^AMT^ and Crown Castle International ^CCI^.
Heading into trading on Monday, IYZ is also up for the past two days in a row, rallying from a three-day pullback that took the fund into oversold territory above the 200-day.
Traders familiar with the Vanguard ETF family will recognize the ^VOX^. VOX is less widely-traded that IYZ, for example, but the ETF does provide similar exposure to the telecom industry as IYZ, making Verizon, AT^&T and domestic telecom equipment makers among its top holdings.
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Up for three days in a row heading into Monday’s open are oil ETFs like the ^USO^ (below) which track the price of crude oil rather than the share prices of oil companies.
Before its recent three-day rally, USO had been trending lower, closing down for five out of six sessions and becoming significantly oversold in the short term.
Meanwhile, traders took profits in energy stocks, as seen in the pullback in the ^XLE^ and the ^DIG^ (below).
DIG has closed lower for three out of the past four trading days.
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David Penn is Editor in Chief of TradingMarkets.com