Dramatically oversold conditions in both equities and commodities has a number of observers worrying about the potential for a major fall in the stock market. Down four days in a row are major equity index ETFs like the ^SPY^ and the ^QQQ^.
Today’s edition of 7 ETFs You Need to Know also includes a number of exchange-traded funds that are currently trading in neutral territory, but could find themselves oversold on any significant selling here at midweek.
Here are 7 ETFs You Need to Know for Wednesdsay.
Selling in energy stocks has helped the ^ERY^ gain more than 9% in Tuesday’s session alone.
After a three-day pullback, the ^IYT^ (below) bounced on Tuesday.
All three lower closes prior to IYT’s Tuesday rally were in oversold territory above the 200-day.
Down two days in a row, but not yet oversold above the 200-day moving average heading into trading on Wednesday is the ^EWP^.
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The TradingMarkets Swing Trading College, now in its 6th year, is one of the most popular trader training programs available anywhere, and spaces are filled quickly each semester with both new and returning students. To save your spot at Larry’s next presentation and preview on the Summer semester, click the link below.
14 Weeks to Trading Mastery: The TradingMarkets Summer 2011 Swing Trading College
Rangebound for the past two trading weeks, the ^IYZ^ is back in neutral territory after a one-day oversold bounce.
Down for four days in a row, with the last three in oversold territory, is the ^IWM^ (below).
Tuesday’s pullback puts IWM at its most oversold level of the year.
Sellers are finally taking profits in the ^SLV^ (below).
The SLV has closed lower for two days in a row, the fund’s first significant pullback in a previously very overbought commodity fund.
Closing lower for a fourth day in a row – the second in oversold territory above the 200-day – were the ^SMH^ in Tuesday’s session.
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David Penn is Editor in Chief of TradingMarkets.com