High Probability ETF Trading: 7 ETFs You Need to Know for Thursday (DBB, DJP, GLD, IAU, OIH, FXE, XRT)

ETF markets are beginnning to pullback in early in trading on Thursday, as overbought conditions in a wide variety of funds encourage profit-taking as the first quarter of 2010 draws to a close.

Here are 7 ETFs You Need to Know for Thursday.

Heading into trading on Thursday there are very few exchange-traded funds trading in oversold territory above the 200-day moving average. Those few that are tend to be commodity ETFs like the ^DBB^ and the ^DJP^.

Even gold funds, which had been trading in oversold territory early in the week, have begun to move higher and are now generally trading in neutral waters above the 200-day. Examples include both the ^GLD^ and the ^IAU^ (below).

IAU chart

Shares of IAU had closed lower for three out of the previous four trading sessions before Wednesday’s modest bounce out of oversold territory.

Traders and investors began taking some profits out of the high-flying market for oil ETFs. Pulling back ahead of trading on Thursday were shares of the  ^OIH^ (below).


OIH had closed in overbought territory for six out of the previous seven trading days before Wednesday’s pullback.

After rallying to new highs last week, shares of the ^FXE^ have settled into a trading range between 140 and 141. Ahead of trading on Thursday, the fund is only slightly overbought.

The ^XRT^ (below) broke out to new highs on Wednesday.

XRT chart

The XRT rallied past its previous closing highs of the year to close up well over 1% on the day.

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David Penn is Editor in Chief of TradingMarkets.com