The following commentary comes from an independent investor or market observer as part of TheStreet's guest contributor program, which is separate from the company's news coverage.

NEW YORK (

TheStreet

) -- The

Dow

and the

S&P 500

may have experienced the worst two-week losses since November. Still, is it really time to panic? When one considers the reality that the major averages are less than -4% from multiyear highs, abandoning stock assets seems a bit premature. That said, you may want to avoid certain investments.

For example, a wide variety of currency ETFs have worked their way into to full-scale correction mode. The

CurrencyShares Euro Trust

(FXE) - Get Report

is 12.4% below a 52-week high whereas the

CurrencyShares Swedish Krona

(FXS) - Get Report

is 11.8% off its peak. And while a lack of interest in European sovereign debt may be to blame, the uncertainties in the Chinese economy are adversely affecting Brazil and the value of the "real."

WisdomTree Dreyfus Brazilian Real

(BZF)

is down 12.8% from a 52-week pinnacle.

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Even though the

U.S. Federal Reserve

has steadfastly devalued the U.S. dollar through its interest rate and easing policies, Europe's economic contraction and ongoing austerity make it difficult for currency ETFs to make appreciable progress. Similarly, until China clarifies its intentions to stimulate its own economy, the currencies of resource-rich countries from South Africa to Brazil may be stuck in the sands.

Of course, it's not just the currencies of foreign countries that are struggling. I conducted a recent screen of stock funds where the short-term trendline (50-day MA) had dipped below the long-term, 200-day moving average on heavier-than-normal volume. The directional "losers" fit roughly into three categories: 1. resources-related stock funds, 2. European stock funds and 3. China ETFs.

Energy and materials may be having the roughest go of it. Everything from broad-based

Rydex Equal Weight Energy

(RYE) - Get Report

to

SPDR Oil Gas Equipment & Services

(XES) - Get Report

to

First Trust Global Copper

(CU)

is 20%-plus off a high point. Selling has intensified over the last five days. Worse yet, the technical picture is rather bearish.

RYE Exp 50 200

The same disturbing trend is occurring for prominent European stock ETFs, including

iShares MSCI France

(EWQ) - Get Report

,

TheStreet Recommends

iShares MSCI Austria

(EWO) - Get Report

,

iShares MSCI Italy

(EWI) - Get Report

and

iShares MSCI Spain

(EWP) - Get Report

. Even China stock ETFs —

iShares FTSI China 25

(FXI) - Get Report

,

PowerShares Golden Dragon

(PGJ) - Get Report

— have seen selling volume intensify as near-term trendlines cross below long-term ones.

FXI Exponential 50 200

For weeks, I’ve maintained the same guidance. You can weather the thunderstorms of greater-than-normal selling volume and increases in volatility (i.e., wider daily trading ranges) with a healthy shift toward yield producers and consumer staple standouts.

For instance, faith in

SPDR Select Sector Staples

(XLP) - Get Report

has rarely been higher. Its uptrend remains entirely intact and it is a mere -2.5% off of its multi-year peak.

XLP Exponential 50 200

In the same manner, there are a wide variety of less volatile income producers that could be bought on the dips, from

Vanguard High Dividend Yield

(VYM) - Get Report

to

Guggenheim Multi-Asset Income ETF

(CVY) - Get Report

. The 3.5%-5.5% annualized income should help to offset the persistent fears of a cataclysmic end to the investment universe. Either way,

appropriate ETF hedges

and

intelligent stop-limit loss orders

should help one rest easier about “being in.”

You can listen to the ETF Expert Radio Show "LIVE", via podcast or on your iPod. You can follow me on Twitter @ETFexpert.

Disclosure Statement: ETF Expert is a website that makes the world of ETFs easier to understand. Gary Gordon, Pacific Park Financial and/or its clients may hold positions in ETFs, mutual funds and investment assets mentioned. The commentary does not constitute individualized investment advice. The opinions offered are not personalized recommendations to buy, sell or hold securities. At times, issuers of exchange-traded products compensate Pacific Park Financial or its subsidiaries for advertising at the ETF Expert website. ETF Expert content is created independently of any advertising relationships. You may review additional ETF Expert at the site.

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