Sunday, January 3, 2010

The Top ETFs For 2010, 25 To Buy and 25 To Sell For Both Long and Medium Terms

There are nearly 800 ETFs that trade in the U.S. We computed the RSI values for all of them. We then sorted them by RSIs weekly and monthly, ascending and descending order. Below you will find the top 25 for each category, for the long term (measured in months) and for the medium term (measured in weeks). In total there are more than 50 ETFs listed.

The Relative Strentgh Indicator is a great tool that shows overvalued and oversold conditions. Typically, values over 70 indicate overbought conditions, and values below 30 show oversold conditions. The greater or lower than these thresholds, the more extreme and unsustainable the the conditions are.

Top 25 To Buy Long Term:

The most oversold ETFs in the long term category are EEV, ultra short emerging market, and CMD, Ultra short commodities.

UNG, the poor natural gas performer is in the list, as is DUG (ultra short oil co's). Interesting to see these two in the same list.

Other very recognizable names are FXP, the ultra short China ETF, as well as QID (ultra short Nasdaq/QQQ). QQQ is on the weekly to sell list (please see below).

Top 25 to Sell Long Term:

Here the most oversold are somewhat exotic instruments PVI (short-term tax-exempt variable-rate demand obligations ,VRDOs, issued by municipalities in the United States), and SHV (short treasury bonds). Unless you really know what these are, it's best to stay away. Another name on the list is PXR, which tracks "price and yield performance of S-Network Emerging Infrastructure Builders index, normally investing at least 90% of total assets in the securities and ADRs and Global Depository Receipts, GDRs.

PKOL tracks the largest and most liquid companies involved in the exploration for, and mining of coal, as well as other related activities in the coal industry.

RTR is in there as well, it's an interesting one ("is an exchange-traded fund that seeks to achieve its investment objective of outperforming the total return performance of the S&P ADR Index by investing in the constituent securities of the S&P ADR Index in the same proportions as the RevenueShares ADR Index.")

A collection of strange ETfs for sure.

Top 25 To Buy Medium Term:

RTW is a 2x bear (inverse) technology ETF. Similarly, TLL is an ultra-short telecom ETF. Sounds like a theme.

Top 25 to Sell Medium Term:

HYG is High Yield Corporate Bond ETF. JNK, you can guess what it means (junk bonds!), Barclays Capital High Yield Very Liquid Index. Same story for PHB, Powershares version, High Yield Corporate Bond Portfolio.

Perhaps the most recognizable name there is QQQ. its weekly RSI is 77.2 It's daily RSI is also very high at 74.53. The monthly is getting there at 65.43. These are scary (too high) numbers that reflect the general market valuations.

These are the ETF names:

(Please click to enlarge)

To receive technical analysis and alerts of these ETFs sent automatically to you, simply enter the symbols in the Technical Trend Analysis Tool.

Please do your own due dilligence.

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