Along with the broad market, most ETFs from last night's stock screening appear a bit extended and may need some time to rest.

Although the setups have dried up this past week, we did notice some bullish patterns developing on the longer-term monthly charts of energy ETFs. The iShares Dow Jones US Oil & Gas Exploration ETF ($IEO) cleared the monthly downtrend line in January and has been consolidating in a fairly tight range since then. If $IEO can clear $75, the next stop would be the prior highs of 2008 (around $86):



SPDR S&P Oil & Gas Equipment & Services ETF ($XES) looks similar to $IEO, but the price action has yet to break out above the monthly downtrend line. $XES is also consolidating in a tight range the past few months, but has relative pattern weakness to $IEO, as it is further away from the highs of 2008 and 2011:



Claymore/AlphaShares China Real Estate ETF ($TAO) is in pullback mode on the daily chart, retreating to the 20-day EMA. Rather than adding to our position here, we'd like to see a tight, two to three week consolidation develop above the 10-week MA (teal line) on the weekly chart below:



$TAO is forming a cup and handle type pattern on the weekly chart after finding support at the 40-week MA (same as 200-day MA on daily chart). We could see a low-risk entry point to add to our existing position in $TAO if the price action can form a higher swing low within the handle.

With $GLD selling off, our position in $DZZ ("short ETF" in gold) is in good shape and showing a nice unrealized profit. As such, we now plan to sell into strength on a test of the prior swing high, which was our original plan at the time of entry. Subscribing members of our ETF and stock trading newsletter should note our updated target and stop prices in the open positions section of today's report.

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.