“It’s going to be pretty sufficiently oversold at the point of a death cross,” Cappelleri said. “A lot of times when you see one, it happens towards the end of a short-term move, so you could get whipsawed.”
Consequently, more aggressive traders who believe in a rebound on the low levels can utilize leveraged ETF options to capture a potential bounce. For instance, the ProShares Ultra Dow30 (NYSEArca: DDM) takes the 2x or 200% daily performance of the Dow, and the ProShares UltraPro Dow30 (NYSEArca: UDOW) takes the 3x or 300% daily performance of the Dow.
SDPR Dow Jones Industrial Average ETF
For more information on the Dow, visit our Dow Jones Industrial Average category.
Max Chen contributed to this article.