In trading on Thursday, shares of the Vanguard FTSE Europe ETF (Symbol: VGK) entered into oversold territory, changing hands as low as $48.52 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 Vanguard FTSE Europe, the RSI reading has hit 28.7 - by comparison, the RSI reading for the S&P 500 is currently 36.9. A bullish investor could look at VGK's 28.7 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), VGK's low point in its 52 week range is $48.52 per share, with $58.51 as the 52 week high point - that compares with a last trade of $48.62. Vanguard FTSE Europe shares are currently trading off about 1.1% 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.