High Probability ETF Trading Report: XLE, IEZ and Other Oversold ETFs
While Thursday’s rally helped boost a number of ETFs out of oversold territory above their 200-day moving averages, the fact remains that many ETFs remain under significant selling pressure. And in no sector is that selling pressure more significant than in the energy patch.
Of the 25 most oversold ETFs in our database as of the close on Thursday, the vast majority of those ETFs were energy-stock related.
This ranged from perhaps the most widely-traded oil stock ETFs, the Energy Select Sector SPDR ETF
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XLE |
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PowerRating) and the Oil Service HOLDRs
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OIH |
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PowerRating), as well as many lesser known energy ETFs such as iShares Dow Jones U.S. Oil Equipment Index ETF
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IEZ |
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PowerRating) and the iShares S&P Global Energy ETF
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IXC |
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PowerRating).
Energy Select Sector SPDR ETF – XLE
iShares Dow Jones U.S. Oil Equipment Index ETF – IEZ
These energy ETFs have been so oversold in recent days that buyers have already begun to bid them higher Friday morning. High Probability ETF traders considering opportunities in these funds to be wary of taking positions in those ETFs that have started to attract buyers shortly after the open on Friday.
Another place for high probability ETF traders to look for potential opportunity is in the BRIC nation of India. A number of India-based ETFs — from Wisdom Tree Earnings India ETF
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EPI |
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PowerRating) to the iPath MSCI India Index ETN
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INP |
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PowerRating) — opened higher Friday morning but have since moved lower and may still represent potential opportunities for traders looking to buy oversold country ETFs on pullback.
iPath MSCI India Index ETN — INP
According to a recent report, eight out of ten securities traded are exchange-traded funds. Want to learn how to trade them? Click here to pre-order High Probability ETF Trading, the first quantified book of trading strategies to improve your ETF trading.
David Penn is Editor in Chief at TradingMarkets.com.