Sellers Send Retail, Consumer Stocks to Oversold Lows as Oil Continues Lower: 7 ETFs You Need to Know for Tuesday

With retail stocks in the earnings spotlight and many stocks only recently off new year-to-date highs, it is little surprise to see profit-taking in the sector. Between overbought conditions on the one hand, and the coming summer lull before back-to-school season, there are no shortage of reasons for traders to rotate out of retail.

The selling in commodities resumed on Monday, with oil and precious metals funds trading lower and deeper into oversold territory above the 200-day moving average. Today’s 7 ETFs You Need to Know includes notes on both commodities and commodity ETFs.

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Here are 7 ETFs You Need to Know for Tuesday.

The sharp sell-off in the retail sector helped exchange-traded funds like the ^RTH^ and the ^XRT^ (below) pullback into oversold territory above the 200-day moving average ahead of trading on Tuesday.

XRT chart

Shares of XRT have closed lower for two days in a row. The fund was last in oversold territory a little over a week and a half ago.

A pullback to the lower end of its two-week trading range sent shares of the ^SMH^ into oversold territory as of Monday’s close. SMh was down just shy of 1% on the day.

The ^USO^ pulled back by more than 2% in trading on Monday and is trading closer and closer to its 200-day moving average.

Oil stocks are similarly oversold, with the ^XOP^ (below) closing lower for four consecutive trading days.

XOP chart

XOP is now trading at its lowest levels since January. The fund, however, is not yet as oversold as it was just a few days ago – when XOP last experienced a four-day pullback.

With growing weakness in retail, the pullback of more than 1% in the ^XLY^ takes the fund below its recent trading range and into oversold territory above the 200-day moving average.

XLY chart

Small cap stocks were among those pulling back the most on Monday. The ^IWM^ pulled back by more than 1% ahead of trading on TETfuesday, closing lower for three out of the past four sessions.

David Penn is Editor in Chief of