IDuring Monday’s trading, shares of the iShares MBS ETF (Symbol: MBB) entered oversold territory, changing hands as low as $94.86 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 oversold if the RSI reading falls below 30.
In the case of iShares MBS, the RSI reading reached 28.3 – in comparison, the RSI reading for the S&P 500 is currently 33.3. A bullish investor might take MBB’s reading of 28.3 as a sign that the recent strong selloffs are running out and are beginning to look for entry point opportunities on the buy side.
Looking at a one-year performance chart (below), MBB’s low point in its 52-week range is $94.86 per share, with $108.83 as its 52-week high – compare with a final trade of $95.03. iShares MBS shares are currently trading down around 2.1% 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.