DBC Crosses Critical Technical Indicator

In trading on Wednesday, shares of the Invesco DB Commodity Index Tracking Fund ETF (Symbol: DBC) entered into oversold territory, changing hands as low as $22.86 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 Invesco DB Commodity Index Tracking Fund, the RSI reading has hit 29.7 — by comparison, the RSI reading for the S&P 500 is currently 67.2. A bullish investor could look at DBC's 29.7 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), DBC's low point in its 52 week range is $22.05 per share, with $25.63 as the 52 week high point — that compares with a last trade of $22.88. Invesco DB Commodity Index Tracking Fund shares are currently trading off about 2.4% on the day.

{{ InlineImage1 }}

Find out what 9 other oversold stocks you need to know about »

Also see: