Energy ETFs Down But Still Overbought

On Tuesday evening, we posted that energy stock ETFs had reached extreme overbought territory. Yesterday the ETFs were showing their first signs of a pullback, with all of them down 2% or more. As shown in the charts below, however, the ETFs remain in overbought territory and still have more room to go on the downside before they even test their first real levels of support.

click to enlarge image

Comments

[dunn]

what do you mean by "Overbought"... Sure if mainly on a technical basis, but fundamentally, maybe not. Your time frame is too short.

[mwswi]

A report issued tonight on the NBC Nightly News, stated that oil could reach $200 a barrel in the next two years. Sure it's a media news report quoting a so-called "expert." We shouldn't give it more weight than it deserves. But could this scenario actually play out? Yes, it is a possibility. Would these ETFs then be considered "overbought" when we all stumble upon this article in the 2008 archives? Perhaps not. Bottom line: It truly is anyone's guess.