In trading on Monday, shares of the HYS ETF (Symbol: HYS) entered into oversold territory, changing hands as low as $98.21 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 HYS, the RSI reading has hit 27.8 — by comparison, the RSI reading for the S&P 500 is currently 29.6. A bullish investor could look at HYS's 27.8 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), HYS's low point in its 52 week range is $94.05 per share, with $100.91 as the 52 week high point — that compares with a last trade of $98.23. HYS shares are currently trading off about 0.6% on the day.