It is no secret that Commodities as an asset class have struggled this year. Coming into 2017, the asset class was ranked second in DALI but has since fallen to fifth, falling below Cash last week. The sub-sector rankings have been changing too. Industrial Metals continue to rank first among the four sub-sectors while Precious Metals have risen from last to second place due to their improved relative strength and the weakness in Energy at the end of Q1. The PowerShares Commodity Model POWRSHARES seeks to own two of the highest relative strength ETFs out of an inventory of eight. Since Precious Metals continue to garner more relative strength (Gold in this case), the POWRSHARES Model will undergo its second change of the year. With last week's action, the PowerShares DB Commodity Index Tracking DBC fell sufficiently within the matrix rankings to warrant its removal from the portfolio. As a result. the PowerShares DB Gold Fund DGL will take its place since it is the highest ranking ETF that is not already owned. 

Since bottoming in December at $36.50, DGL has returned to a buy signal at $41 in April and is now currently testing its bearish resistance line. A double top break at $41.50 would flip the trend back to positive. DGL offers a fund score of 3.97, which is paired with a score direction of 2.36 speaking to its improvement over the past six months. Its high fund score tops all of its benchmarks’ average scores: Precious Metals (2.12), All US (3.52), and Commodities (1.29). In addition, its weekly momentum recently flipped positive indicating the potential for higher prices over the next several weeks. DGL comes with a bullish price objective of $46.50, which also indicates the potential for further price appreciation from current levels. All of these positive technical developments has led to DGL returning 9.40% year-to-date (through 6/9) compared to the market (S&P 500 Index SPX) up 8.62%. Those interested in gaining exposure to Gold may initiate positions at current levels. Support comes in the upper $30’s from here. For those already long, the next resistance levels are at $42 and $44.50. The Model will be rebalanced and offers exposure to Base Metals DBB (50%) and Gold DGL (50%). 

The distribution curve places each ETF on a bell curve according to their respective degrees of overbought or oversold status using a 10-week distribution. ETFs that are statistically oversold will appear on the left-hand side of the bell curve, while those that have become statistically overbought will appear on the right-hand side of the bell curve. Perhaps the most useful attribute of this feature is that it displays the entire universe on the curve at one time to give us a general picture of whether the PowerShares ETF universe is generally overbought on a near-term basis, or generally oversold. Our best opportunities are to buy strong relative strength ETFs that have regressed back toward mean conditions based on market weakness, or have become oversold based upon extreme market weakness. Weekly Distribution is a short-term gauge that is most helpful in timing entry and exit points, while the longer-term information of trend and relative strength is a more controlling factor in the decision of whether to buy or sell.

Average Level: 32.52

The average Bullish Percent reading this week is 57.65% up 0.89% from the previous week

								PFI
								PTF
								PRF
								PKW
							PSL	PSI
							pey	pio
							pbe	PEZ
						DBP	dba	PUI	UDN
						pvi	PEJ	pcy	PRN
					DBS	PJP	paf	pzt	picb
					PBJ	DGL	plw	PWC	adru
					DBV	KBWY	PSR	pgj	PWB
					pxr	PBS	pgf	PNQI	PSJ
					dbb	PXQ	PRFZ	adre	PFM
					PXMV	KBWD	pid	PDP	pbp
			UUP		pagg	pkb	phb	pie	PXSG	pxf
			dbo		puw	PYZ	pbw	PPA	pza	psp	pzd
		pxj	pxi		PSAU	PMR	pgx	PTH	adrd	PXMG	piz
		dbe	dbc		pxh	PZI	PHO	pwz	pbd	pdn	adra
<--100	-100--80	-80--60	-60--40	-40--20	-20-0	0-20	20-40	40-60	60-80	80-100	100->

Legend:

• UPPERCASE indicates that the RS chart is on a buy signal.
• lowercase indicates that the RS chart is in a sell signal.
• GREEN lettering indicates the ETFs trend chart is on a buy signal.
• RED lettering indicates the ETF is on a sell signal.

The table below is a review of important technical data on a select group of PowerShares ETFs. Significant changes within the past week are highlighted in Green if positive or Red if negative. This portfolio is designed to be used as a "radar" screen to bring your attention to potentially important technical changes that may require your attention and potential action. Below this week's featured portfolio is the ability to see other PowerShares portfolios including Market, Sector, International, Dynamic family, and RAFI family. 

* - Dates prior to 1/24/2011, which is when the PowerShares Sector Seven ETF Model Portfolio became available in the PowerShares Weekly ETF Report, are representative of when the position was added to the backtested model.

* - Dates prior to 6/1/10, which is when the PowerShares Small Cap Sector Model ETF Portfolio became available in the PowerShares Weekly ETF Report, are representative of when the position was added to the backtested model.

* - Dates prior to 6/7/13, which is when the DWA Global Technical Leaders Portfolio became available in the PowerShares Weekly ETF Report, are representative of when the position was added to the backtested model.

* - Dates prior to 8/31/15, which is when the PowerShares Multi Factor Global Equity Model became available in the PowerShares Weekly ETF Report, are representative of when the position was added to the backtested model.