High Probability ETF Trading: 7 ETFs You Need to Know for Tuesday (EWH, FXI, GLD, GDX, OIL, DBO, EWP)
After a one-day bounce, most ETF markets are moving lower early in trading on Tuesday. Should selling intensify over the next day or two, then high probability traders could easily find themselves back in a position to scale-in to any number of major equity index ETFs that have pulled back into oversold territory above the 200-day moving average.
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Here are 7 ETFs You Need to Know for Tuesday.
Some of the most oversold exchange-traded funds (ETFs) going into trading on Tuesday are Asian country funds. This includes both the ^EWH^ and the ^FXI^ (below).
Shares of FXI have closed lower for three days in a row – all three in oversold territory above the 200-day – and are down six out of the past seven.
In addition to Asian country funds, precious metals related ETFs have also traded lower in recent days. Among these commodity ETFs are the ^GLD^ and the ^GDX^.
Shares of GLD have closed lower for three days in a row and are headed lower early in trading on Tuesday. GDX has closed lower for four trading days and is also moving lower as trading begins on Tuesday.
Oil ETFs have also shown weakness over the past few sessions. The most oversold oil-based fund is the ^OIL^, though the ^DBO^ (below) has closed lower for four out of the past five trading days.
DBO is moving lower on Tuesday. A lower close on Tuesday would make a second consecutive trading day in oversold territory.
Pulling back toward oversold territory just days after rallying above its 200-day moving average is the ^EWP^ (below).
Shares of EWP has closed higher for nine trading days before selling off early on Tuesday. This nine-day rally helped bring the EWP up from below the 200-day moving average back in mid-January.
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David Penn is Editor in Chief of TradingMarkets.com