Some Key Funds May Be on the Precipice

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Volatility’s on the rise this month, and three popular ETFs are trying to hang on.

The Market Vectors Semiconductor ETF (SMH), S&P SPDR Financial ETF (XLF) and S&P SPDR Energy ETF (XLE) had all slammed down to apparent support levels earlier in the year. At the same time, they’ve made a series of lower highs.

Some chart watchers may view that kind of price action as “bearish descending triangles” with the potential for more downside. They’ve also recently broken under their 200-day moving averages, another potentially negative signal.

Market Vector Semiconductor ETF (SMH) with levels and 200-day MA.
SPDR Financial ETF (XLF) with levels and 200-day MA.
SPDR Energy ETF (XLF) with levels and 200-day MA.

Disclosure: This post is for educational purposes only and should not be interpreted as a trade recommendation.

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David Russell is VP of Content Strategy at TradeStation. Drawing on nearly two decades of experience as a financial journalist and analyst, his background includes equities, emerging markets, fixed-income and derivatives. He previously worked at Bloomberg News, CNBC and E*TRADE Financial. Russell systematically reviews countless global financial headlines and indicators in search of broad tradable trends that present opportunities repeatedly over time. Customers can expect him to keep them appraised of sector leadership, relative strength and the big stories – especially those overlooked by other commentators. He’s also a big fan of generating leverage with options to limit capital at risk.