In trading on Wednesday, shares of the iShares TIPS Bond ETF (Symbol: TIP) entered into oversold territory, changing hands as low as $109.0201 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 iShares TIPS Bond, the RSI reading has hit 29.5 - by comparison, the RSI reading for the S&P 500 is currently 51.1. A bullish investor could look at TIP'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), TIP's low point in its 52 week range is $109.0201 per share, with $115.76 as the 52 week high point - that compares with a last trade of $109.06. iShares TIPS Bond shares are currently trading down about 0.4% on the day.