5 ETFs for the Next 5 Days: Edges in Gold and Leveraged Technology


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Before looking at some of the exchange-traded funds with quantified edges heading into trading on Friday, let's take a quick review of how the stocks from our last column , 5 Stocks for the Next 5 Days have fared in recent trading.

Basis Monday's close, we looked at five stocks that had become overbought below the 200-day moving average. All five of these stocks had closed higher for multiple consecutive trading days below the 200-day, and earned 2-period RSI readings of well over 90. In fact, all five stocks had 2-period RSI values of more than 98 when they appeared in our 5 Stocks for the Next 5 Days roster.

And all five stocks have traded significantly lower in the days since we highlighted these stocks as market to avoid - or sell short. Shares of Digital River Inc ( DRIV ) have closed lower for three days in a row since making our 5 Stocks for the Next 5 Days roster. Shares of LMT sold off by more than 5% over two days after making our list. VeriFone Holdings Inc ( PAY ) dropped by well over 7% over the three days since appearing in 5 Stocks for the Next 5 Days . Similar moves were seen in the other stocks from our 5 Stocks list, with both Children's Place Rtl Str ( PLCE ) and Titanium Metals Corp New ( TIE ) also closing lower for three days in a row after becoming dramatically overbought below the 200-day.

Here are 5 ETFs for the Next 5 Days

Heading into the weekend, the biggest edge is clearly in gold. And not just the gold mining stocks of the Market Vectors Gold Miners ETF ( GDX ) , either. Bullion-based funds like the SPDR Gold Shares ( GLD ) and the iShares COMEX Gold Trust ( IAU ) have also pulled back to levels from which they have historically reversed and moved higher. Both GLD and IAU have dropped by more than 2%, closing lower for two out of the past three sessions above the 200-day moving average.

Traders looking for gold stocks that have pulled back above the 200-day rather than exchange-traded funds may want to keep an eye on stocks like Newmont Mining Corp ( NEM ) and Yamana Gold Inc ( AUY ) .

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Another areas were quantified edges have begun to emerge is in leveraged funds based on technology and the Nasdaq 100. This include ETFs like the Direxion Technology Bull 3X Shares ( TYH ) - down more than 9% on Thursday and closing lower for a third day in a row - and the ProShares Ultra QQQ ( QLD ) . Shares of the QLD have also closed lower for three days in a row, and fell by more than 6% ahead of trading on Friday.

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David Penn is Editor in Chief of TradingMarkets.com

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

This article appears in: Stocks
Referenced Symbols: AUY , GLD , NEM , PAY , QLD

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