In trading on Monday, shares of the SPDR S&P Regional Banking ETF (Symbol: KRE) entered into oversold territory, changing hands as low as $41.13 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 SPDR S&P Regional Banking, the RSI reading has hit 29.5 - by comparison, the RSI reading for the S&P 500 is currently 34.1. A bullish investor could look at KRE's 29.5 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), KRE's low point in its 52 week range is $35.01 per share, with $46.33 as the 52 week high point - that compares with a last trade of $41.22. SPDR S&P Regional Banking shares are currently trading off about 1.2% on the day.