Relatively mild trading on Monday masked some potentially significant differentiation among the major equity index ETFs. As such, the ^SPY^ will open overbought on Tuesday, while the ^QQQQ^ has pulled back into decidely neutral territory above the 200-day moving average.
Here are 7 ETFs You Need to Know for Tuesday.
Profit-taking in retail has helped popular retail ETFs pull back into oversold territory going into trading on Tuesday. These funds include the ^RTH^ and the ^XRT^ (below)
XRT’s Monday close was the lowest in the ETF all month. The fund’s December oversold low was back on the eighth.
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Also representative of the selling in retail stocks was the mild pullback in the ^XLY^. Although the fund pulled back less than half a percent on Monday, XLY is likely to slip into oversold territory should the selling follow-through for a second day.
High yield debt continued to trade in oversold territory above the 200-day. Closing lower for a third day in a row was the ^JNK^, while the ^HYG^ (below) has closed down for three out of the past four trading days.
Shares of HYG closed on Monday at their most oversold level since mid-November.
Sellers may be emerging in the technology sector, as well. PUlling back into oversold territory above the 200-day ahead of Tuesday’s open were shares of the ^SMH^ (below).
Shares of SMH have closed lower for two days in a row. The fund’s two-day pullback comes just after the ETF had reached a new year-to-date high for 2010.
The ^IYT^ is another exchange-traded fund that began to pull back modestly on Monday. Additional selling here could put the ETF in oversold territory above the 200-day by midweek.
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David Penn is the Editor in Chief of TradingMarkets.com