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NEW YORK (TheStreet) -- If Monday whetted your appetite to invest or trade in the extreme volatility that is China and other emerging markets, the exchange-traded fund of choice is the iShares Emerging Markets ETF (EEM) - Get iShares MSCI Emerging Markets ETF Report, which tracks the performance of 21 emerging markets including China.

An alternative is the iShares China Large-Cap ETF (FXI) - Get iShares China Large-Cap ETF Report, which tracks the FTSE/Xinhua China 25 Index.

Here are the weekly chart and key technical levels for the emerging-markets ETF.


Courtesy of MetaStock Xenith

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The weekly chart for the emerging-markets ETF is negative but oversold, with the ETF below its key weekly moving average of $35.71. The weekly momentum reading is projected to decline to 7.44 this week down from a reading of 8.46 on August 21 becoming deeper below the oversold threshold on 20.00.

Note that the 200-week simple moving average now at $41.05 had been the reversion to the mean since the week of Aug. 7, 2009, when this moving average was $36.61.

The emerging-markets ETF had a close of $31.31 on Monday, down 20.3% year to Date. EEM is consolidating the crash of 2008 where the ETF declined 67.4% from a high of $55.83 during the week of Nov. 2, 2007 to the low of $18.22 during the week of Nov. 21, 2008. Note that the ETF has traded mostly between the 50% Fibonacci Retracement of $37.05 and the 61.8% retracement of $41.48. Monday's weakness had the ETF below the 38.2% retracement of $32.63 for the first time since the week of Set. 4, 2009.

Investors looking to buy the ETF should place a good-till-canceled limit to buy EEM if it declined to the 23.6% retracement of $27.15.

Investors looking to reduce holdings should place a good-till-canceled limit to sell the ETF if it rises to $33.17 and $34.90, which are key levels on technical charts until the end of 2015.

Here's the weekly chart and key technical levels for the China large-cap ETF.


Courtesy of MetaStock Xenith

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The weekly chart for the China large-cap ETF is negative but oversold, with the ETF below its key weekly moving average of $40.12. The weekly momentum reading is projected to decline to 12.63 this week down from a reading of 15.40 on Aug. 21 becoming deeper below the oversold threshold on 20.00.

Note that the 200-week simple moving average now at $38.37 had been the reversion to the mean since the week of May 8, 2009, when this moving average was $34.95.

The China large-cap ETF had a close of $34.23 on Monday, down 17.8% year to Date. FXI is consolidating the crash of 2008 where the ETF declined 73.6% from a high of $73.18 during the week of Nov. 2, 2007 to the low of $19.35 during the week of Oct. 31, 2008. Monday's weakness had the ETF approaching its 23.6% Fibonacci of $31.98.

Investors looking to buy the ETF should place a good-till-canceled limit to buy EEM if it declined to the 23.6% retracement of $31.98.

Investors looking to reduce holdings should place a good-till-canceled limit to sell the ETF if it rises to $34.99, which is a key level on technical charts until the end of 2015.

Investors not familiar with technical analysis should begin with the notion that a price chart for a stock shows a road map of past price performance, which provides guidance for predicting future share price direction.

Here's how to read a daily chart. There are two moving averages to follow; the 50-day simple moving average is in blue while the 200-day simple moving average is in green.

Here's how to read a weekly chart. The red line tracks the ups and downs of the key weekly moving average. The green line is the 200-week simple moving average. The red line that oscillates along the bottom of the chart is the momentum reading on a scale of 00.00 to 100.00. A reading below 20.00 is oversold and a reading above 80.00 is overbought.

A technically positive weekly chart occurs when a stock ends a week above its key weekly moving average with the momentum reading rising above 20.00.

A technically negative weekly chart occurs when a stock ends a week below its key weekly moving average with the momentum reading declining below 80.00.

This article is commentary by an independent contributor. At the time of publication, the author held no positions in the stocks mentioned.