In trading on Thursday, shares of the First Trust North American Energy Infrastructure Fund ETF (Symbol: EMLP) entered into oversold territory, changing hands as low as $20.7628 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 First Trust North American Energy Infrastructure Fund, the RSI reading has hit 29.2 - by comparison, the RSI reading for the S&P 500 is currently 31.8. A bullish investor could look at EMLP's 29.2 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), EMLP's low point in its 52 week range is $20.40 per share, with $25 as the 52 week high point - that compares with a last trade of $20.82. First Trust North American Energy Infrastructure Fund shares are currently trading off about 1.9% 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.