XLU Crowded With Sellers
In trading on Friday, shares of the The Utilities Select Sector SPDR— Fund ETF (Symbol: XLU) entered into oversold territory, changing hands as low as $60.695 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 The Utilities Select Sector SPDR— Fund, the RSI reading has hit 23.2 — by comparison, the RSI reading for the S&P 500 is currently 16.4. A bullish investor could look at XLU's 23.2 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), XLU's low point in its 52 week range is $56.65 per share, with $71.10 as the 52 week high point — that compares with a last trade of $61.55. The Utilities Select Sector SPDR— Fund shares are currently trading down about 4.3% on the day.
