Last night, we thoroughly scanned a list of international ETFs to locate strong patterns forming near 52-week highs. With the U.S. stock market now under institutional distribution and most leading stocks falling apart, we also wanted to see if there were any ETFs with a low correlation to the domestic markets that may still be exhibiting relative strength. Here are the charts of a few international ETFs from that list:

The iShares MSCI Indonesia Fund ($EIDO) is consolidating near its prior high of 2011, and is now forming a tight base above the rising 10-week moving average (similar to the 50-day moving average). This is shown on the weekly chart of $EIDO below:



Above, notice how the 10-week moving average has been separating away from the 40-week moving average since the strong base breakout from the $31 level earlier this year. This is bullish and indicates a strengthening trend. However, because the consolidation near the high is not yet long enough, the pattern is NOT buyable right now. Nevertheless, this ETF could be in play on the long side within the next few weeks if the consolidation tightens up on the daily chart and thereby provides us with a low-risk swing trade entry point.

The iShares MSCI Mexico Index Fund ($EWW) recently broke out to a fresh all-time high, as it cleared the highs of 2007 and 2011 earlier this year. The 20-day exponential moving average has crossed above the 50-day moving average, and this international ETF should soon be ready to form a tight "handle" below the highs of the current base (learn about the "cup and handle" pattern here). We would also like to see the price hold above the 50-day moving average as it continues to consolidate:



Additionally, we are monitoring Ishares Msci Turkey ($TUR) and iShares MSCI Singapore ($EWS) for potential swing trade entry points within the next week or two, and will likely analyze these charts for Wagner Daily newsletter subscribers next week.

When our timing model shifts to "sell" mode, we are basically saying that the market is vulnerable to a sharp selloff. That means traders and investors should consider taking profits on extended positions that are showing signs of weakness, or at least trail tight stops to protect gains. But if your stock or ETF does not budge while the market is under distribution, you may be holding on to a position that is a true market leader. In this case, by all means, do NOT sell as long as the stock holds up.

Deron Wagner is the Founder and Head Trader of both Morpheus Capital LP, a U.S. hedge fund, and MorpheusTrading.com, a trader education firm.