High Probability ETF Trading: 7 ETFs You Need to Know for Tuesday (EWG, EWU, EFA, UDN, EZA, EWS, DDM)

The ^QQQQ^ and ^IWM^ both continued to trade higher at the beginning of the week, moving back toward overbought territory above the 200-day moving average.

The pullbacks in India country funds noted in yesterday’s 7 ETFs You Need to Know have led to modest, one-day rallies of more than 1% in ETFs like the ^EPI^

Here are 7 ETFs You Need to Know for Wednesday.

Joining the growing number of European country funds trading in oversold territory above the 200-day moving average on Monday were the ^EWG^ and the ^EWU^ (below)

EWU chart

Down more than 1% on the day, EWU managed to rally intraday to close well-off its lowest levels. EWU had closed lower for the past two days in a row.

Closing down for a fifth day in a row was the ^UDN^ on Monday. Shares of UDN have been trading above their 200-day moving average since the second half of September.

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An intraday rally helped trim the pullback in the ^EFA^ (below) ahead of trading on Tuesday.

EFA chart

The fund closed down nearly 1% on the day, the ETF’s second consecutive close in oversold territory.

Two exchange-traded funds nearing oversold levels above the 200-day moving average going into Tuesday’s trading are the ^EZA^ and the ^EWS^ (below)

EWS chart

EWS had closed in oversold territory for two out of the past three trading days before Monday’s close just above those levels. The fund rallied to close off its lowest levels, breaking even on the day.

Trading lower and lower toward oversold territory ahead of Tuesday’s open was the ^DDM^. DDM was last oversold two weeks ago, shortly before rallying to gain more than 3% in two days.

With 7 professional, quantified trading strategies for trading both bull and bear markets, High Probability ETF Trading by Larry Connors and Cesar Alvarez was voted one of the top 10 trading books of 2009 by SFO Magazine. Click here to find out why.

David Penn is Editor in Chief of TradingMarkets.com

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