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ETF Charts

Though they do not have Power Gauge Ratings, you can use the technical analytics on Chaikin charts to effectively identify strong and weak ETFs.

Bullish ETFs

The same technical criteria which make a stock a “Classic Bull” work for ETFs as well:
  • Price is above a rising long-term trend
  • Strong Chaikin Money Flow
  • Strong Relative Strength

The above chart of the SPDR Industrial Sector ETF (Symbol: XLI), shows these criteria all through 2013, along with Relative Strength Buy Signals which identifed key entry points.

When the ETF broke down below its long-term trend in January 2014, this indicated a potential change in its overall Bullish orientation.

Bearish ETFs

The following chart shows the opposite for the PowerShares DB Commodity Index (DBC):
  • Price below a falling long-term trend
  • Weak Chaikin Money Flow
  • Weak Relative Strength

Differences between Stocks and ETFs

ETFs do not have a Power Gauge Rating and do not trigger Signals which require a Power Gauge Rating.

Use Relative Strength Buy/Sell and Relative Strength Breakout/Breakdown Signals, which look for significant patterns in an ETF’s momentum relative to the market, to identify lower-risk entry and exit points.