In trading on Friday, shares of the iShares Agency Bond ETF (Symbol: AGZ) entered into oversold territory, changing hands as low as $118.76 per share. We define oversold territory using the Relative Strength Index, or RSI, which is a technical analysis indicator used to measure momentum on a scale of zero to 100. A stock is considered to be oversold if the RSI reading falls below 30.
In the case of iShares Agency Bond, the RSI reading has hit 29.6 — by comparison, the RSI reading for the S&P 500 is currently 64.5. A bullish investor could look at AGZ's 29.6 reading as a sign that the recent heavy selling is in the process of exhausting itself, and begin to look for entry point opportunities on the buy side.
Looking at a chart of one year performance (below), AGZ's low point in its 52 week range is $117.1764 per share, with $123.56 as the 52 week high point — that compares with a last trade of $118.78. iShares Agency Bond shares are currently trading down about 0.1% on the day.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.