First Trust Low Duration Opportunities Getting Very Oversold
In trading on Wednesday, shares of the First Trust Low Duration Opportunities ETF (Symbol: LMBS) entered into oversold territory, changing hands as low as $50.21 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 Low Duration Opportunities, the RSI reading has hit 29.8 — by comparison, the RSI reading for the S&P 500 is currently 62.1. A bullish investor could look at LMBS's 29.8 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), LMBS's low point in its 52 week range is $50.19 per share, with $51.65 as the 52 week high point — that compares with a last trade of $50.20. First Trust Low Duration Opportunities shares are currently trading down about 0.3% on the day.
