Selling in commodities continues to define much of the ETF market, with traders and investors exiting both specific commodity funds as well as broader-based, commodity index ETFs. This is despite the market’s move higher on Friday, a move which began to relieve oversold conditions in a number of markets.
Much attention will paid to the continuing developments in Japan, with many exchange-traded funds with exposure to Japan – such as the ^EWJ^ – like to experience even more selling pressure at the beginning of the week. EWJ lost more than 1% in trading on Friday, and has closed lower for four out of the past six trading days.
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Relative to oil equity ETFs, oil commodity ETFs like the ^USO^ and the ^OIL^ are significantly more oversold. Both USO and OIL have closed lower for four trading days in a row and were down more than 1% on Friday.
Bounding higher after a four-day pullback was the ^GDX^ (below).
Shares of GDX rallied by well over 1% on Friday, but still remain very much in neutral territory heading into Monday’s open.
Among country funds, two of the more oversold are the ^EWG^ and the ^EWU^ (below).
After closing lower for four out of the previous five trading days, EWU bounced modestly in Friday’s trading. The gains were not enough, however, to lift the ETF out of oversold territory where it will open Monday morning.
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Commodities continue to experience significant selling heading into the new week. Down four out of the past five trading days is the ^DBC^, while the ^DBA^ (below) has pulled back for six straight sessions.
Shares of DBA have closed in oversold territory for the past three consecutive trading days, and is trading at its most oversold levels of the year.
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David Penn is Editor in Chief of TradingMarkets.com